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IV
Humphrey LLoyd
The Technology and Construction Court
High Court of Justice
London
vii
IV
This edition was to have made its appearance a year earlier to capture the
amendments made by the 2004 edition. As there was word of the
impending enactment of the Building and Construction Industry Security
of Payment Act 2004 (SOP Act), the publication of the second edition of
this book was held back as it was envisaged that there would be
'consequential' amendments made to the PSSCOC arising from the
provisions of the SOP Act.
By the time a decision was taken ro produce the new edition, my coauthor, Christopher, had become unavailable. He had earlier left the
University for the private sector. It was left to me to do a solo job. There
is a change in the format of the book. After the introduction, l had moved
the chapters around to reflect more accurately the sequence of the two
documents of the PSSCOC, that i~. the main document and the
Supplement. found as soft copies in the homepage of the Building and
Construction Authority. A decision was taken to remove the chapter
numbers to avoid the possible confusion between the chapter number and
clause number.
The format within each clause has remained unchanged to indicate the
intention of the clause followed by the parties obligations and liabilities
as well as rights and remedies, the role of the Superintending Officer
(SO) and other parties where relevant and the cross references. Most of
the clauses now have a longer discussion on the general principles
applicable as well as the intention of the clause. Changes made by the
2004 and 2005 editions are indicated in the clause under discussion
where relevant.
The bulk of the amendments are found in Clauses 32 and 34. The main
task of the drafters of the 2005 edition appears to be to incorporate
changes that integrate the contractual payment scheme as well as the
dispute resolution scheme with that provided b) the SOP Act. It appears
to be the intention of the drafters to put the parties to the contract on the
road to adjudication since the application for payment by the contractor
has been changed so that the contractor initiates the statutory payment
scheme that leads to the statutory adjudication process by having to put in
a Payment Claim as against a monthly statement used in the earlier
editions. If that be so, I humbly submit that a more appropriate approach
IX
Contents
Page
f
f
f
,/
111
ix
xi
xv
xvii
I
11
25
31
37
47
53
59
~
65
7J
83
87
95
99
I 09
113
121
127
133
139
J 45
149
l 53
159
167
173
Contents
Clause 27
Clause 28
Clause 29
Clause 30
Clause 31
Clause 32
Clause 33
Clause 34
Clause 35
Clause 36
Option Modules
Supplement
179
183
189
195
201
215
237
241
253
255
263
269
277
Index
Table of Cases
\~
xiv
xv
Table of Cases
Hiap Hong & Co Pte Ltd v I long Huat Development Co (Pie) Ltd
[2001] 2SLR 458 .................................................................................................... 215
Hobson v Gorringe [ 1897] I Ch 182.................................................. .......................... 160
Hoenig v Issacs [1952) 2 All ER 176 ........................................................................... 2 15
Holland v Hodgson ( 1872) LR 7 CP 328 ................................................................... . 159
HW Nevill (Sunblest) Ltd v William Press & Son Ltd ( 1982) 20 BLR 78 .................... 127
IBAvEM1[1980] 14BLR 1........................................................................................... 53
Independent Broadcasting Authority v EMI Electronics Ltd and
BICC Construction Ltd (1980) 14 BLR 1.................................................................. 53
Iran Vojdan, The; Dubai Electricity Co v Islamic Republic of Iran Shipping Lines
[ 1984] 2 Lloyd's Rep 380 ....................................... ........ ............ .. ......................... 255
James Miller and Partners Ltd v Whitworth Street Estates (Manchester) Ltd
[ 1970] AC 583: [ 1970] I All ER 796 ........................................................................ 255
Kassim Syed Ali & Ors v Grace Development Pte Ltd & Anor [ 19981 2 SLR 393 ...... I 14
Keen&Keen, lnre [l902] l KB555 ............................................................................. 161
Kredietbank NV v Sinotani Pacific Pte Ltd (Agricultural Bank of China. third party)
[ 1999] 3 SLR 288 ...................................................................................................... 255
Lamprell v Billericay Union ( 1849) 3 Exch 283 ............................................................ I 00
Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd (1993] 3 All ER 417 ......... 196
Lokc Hong Kee (SJ Pte Ltd v United Overseas Land Ltd ( 1982) 23 BLR 35 ................. 38
Lucas v Godwin ( I 837) 3 Bing NC 744 ......................................................................... I00
Management Corporation Strata Title Plan No 1166 v Chubb Singapore Pte Ltd
(1999) 3 SLR 540 .................................................................................................. 38, 7 1
Nanfri, The: Federal Commerce and Navigation Ltd v Molena Alpha Inc & Ors
[ 1979] I All ER 307 ................................................................................................. 202
Peak Construction (Liverpool) Ltd v McKinney Foundations Ltd ( 1970) 1 BLR I 14 .. 100
People's Park Chinatown Development Pte Ltd v Schindler Lifts (S) Pte Ltd
[1993] I SLR 59 1...................................................................................................... 160
Penni Corporation v Commonwealth of Australia ( 1969) 12 BLR 82 .......................... 216
Raymond Construction Pte Ltd v Low Yang Tong & Anor ( 1998) 14 Const LJ 136 .... 128
Reeves v Barlow (1884) 12 QBD 436 ............................................................................ 161
Royal Design Studio Pte Ltd v Chang Development Pte Ltd ( 1991] 2 MU 229 ............ 88
Samuels v Davis [ 1943] KB 526 ...................................................................................... 53
San International Pte Ltd (fka San Ho Huat Construction Pte Ltd) v
Keppel Engineering Pte Ltd ( 1998] 3 SLR 871 ........................................................ 201
Sapiahtoon v Lim Siew Hui (1953] MLJ 305 ............................................................... 215
Seath & Co v Moore ( 1886) 11 App Cas 350 ................................................................ t 60
Shaikh Faisal t/a Gibca v Swan Hunter Singapore Ptc Ltd [ 1995) I SLR 394 .............. 255
Sutcliffe v Thackrah (1974) 4 BLR 16 .................. .. .................................................. 25
Teknikal dan Kejuruteraan Pte Ltd v Resources Development Corp (Pte) Ltd
[ 1994] 3 SLR 743 ........................................................................................................ 87
Temloc Ltd v Erill Properties Ltd ( 1987) 39 BLR 30 ................................................... 114
Tolhurst v Associated Portland Cement Manufacturers Ltd [ 1902] 2 KB 660 .............. 197
W Hanson (Harrow) Ltd v Rapid Civil Engineering Ltd and
Usbome Developments Ltd (1987) 38 BLR 106 ................................................... 160
Williams v Fitzmaurice (1858) 3 H & N 844 ................................................................. 134
Winter, In re ( 1878) 8 Ch D 225 ..................................................................................... 161
xvi
Table of Legislation
Statutes
Arbitration Act
(Cap 10. 1985 Ed) .......... 241. 243, 249
s 2 ................................................... 257
Building and Construction Industry
Security of Payment Act 2004 ...... 8, 9,
20, 215, 223. 227.
228, 231,232,233.
241,244.245.246.
248,250.259.263
s 2................................ 13. 18, 20, 2 18.
219 ,220,223
s 8(5) .......................... 13. 19, 219. 223
s 10(1) .............................................. 19
s 10(3) ............................................ 230
s 10(3)(a) ......................................... 19
s 10(3)(b) ................................. 19. 2 19
s 11 ................................................. 220
s 11(1) .............................................. 20
s 12(4) .............................................. 20
s 36........................ 2 18. 220, 232. 233
s 36(2)(a) ............................. 13. 19, 20
Building Control Act
(Cap 104. 1998 Ed) ......................... 59
Civil Law Act
s 4(8) .............................................. 196
Subsidiary Legislation
Building and Construction Industry
Security of Payment Regulations
2005 ............................................... 19
reg 5 .............................................. 219
Building Control Regulations ............... 59
Factories (Building Operations and
Works of Engineering Construction)
Regulauons ...................................... 59
XVII
2
3
The current role is now undenaken by the Building and Construction Authority
(BCA).
Construction Industry Development Board (l 990). Explanatory Notes for Conditions
of Co111ract for Construction Works, CIDB, Singapore.
Construction Industry Development Board ( 1989), Cost Competitiveness of the
Construction Industry in Singapore.CIDB. Singapore.
(I)
(2)
(3)
(4)
(5)
Clearly it cannot be desirable that each member of the construction team has
to familiarise themselves with the contractual implications of diverse contract
form s.8
With this acknowledgement, the Working Committee stated the need for
standardisation in clear express terms that would set the framework for
development of the new form coupled with some degree of flexibility:
The obvious approach is to standardise, as much as possible, these contract
forms. Standardisation does not mean that a contract fom1 s hould not contain
special provisions relaung to the peculiar circumstances of a given project. It
does mean that the bulk of the provisions are well tried and understood by all
parties involved, including the operational personnel who are actually
involved in supervising and carrying out the construction activities on site. In
this way, the contractual risks associated with a particular project will become
more readily ascertainable and it would be possible to reduce tendering effort
and expenses.9
This same stated objective is retained in the first two paragraphs of the
Foreword in the PSSCOC 1995:
The Public Sector Standard Conditions of Contract for Construction Works
was developed to enable a common contract form to be used in all public
sector construction projects.
Standardisation will increase familiarity among users, reduce tendering
effort and promote greater efficiency in contract administration.
Works 24 Form
HDBGCOC7
Modified FIDIC
The basis for development of these individual forms varied from one
organisation to another, with historical antecedents that go many years
back. What was clear was the obvious diversity of forms in use across
various public sector organisations.
Standardisation
The need for standardisation derived principally from the CIDB Report
on Construction Competitiveness which drew attention to the presence of
the many different forms of construction contracts as being one of the
5
6
7
8
9
(I)
(2)
(3)
(4)
(5)
Adaptability of the form was essentially intended lo enable its use readily
to diverse project situations and to accommodate inevitable differences in
project operating procedures and requirements of various government
departments and statutory bodies. With this in mind, the proposed draft
would contain only the basic or core conditions that would be structured
so as to facilitate the incorporation of provisions that were more project
specific. 10 These basic or core conditions would thus fonn the Core
Module.
Principal categories of project requirements would be catered through
the use of option modules that, when combined with the Core Module,
would be able to meet the specific requirements of the range of project
situations envisaged. This meant that the proposed conditions would be
drafted on the basis of a lump sum contract based on Drawings and
Specifications. with an option module drafted to cater for contracts based
on Bills of Quantities. Bearing in mind the limitation of a single set of
conditions, separate forms for smaller projects and minor works, as well
as for design and build contracts, would be developed. 11
Promotion of sound construction management practice was to be
achieved by emphasising clear lines of responsibility and accountability.
One example of this was the intended reduction of the need for
nomination by placing total responsibility for nominated subcontractors
on the main contractor. 12 Another was the requirement for contractors to
price variations and estimate their effects on completion time, as and
when they arise, thereby tightening budgetary control and improving
financial discipline. 13
Improvement of construction quality would be achieved by using
objective standards in determining achievement of the requisite level of
construction quality in favour of subjective ones that depended on
decisions of the Superintending Officer (SO). This, however, was in tum
dependent on consistency in the drafted conditions with the use of quality
related specifications in the drawings and other contract documents. 14
Efficient allocation of risks aimed for a basis which would essentially
allocate contractual risks in such a way that each risk fell to be borne by
the party best suited to deal with it. One clear example of this would be
the placing of the risks attaching to the preparation of details on the
10
11
12
13
14
(2)
(3)
Contract Documents
Provision that all the constituent contract documents should be
taken as mutually explanatory. (Adopted in Clause 3. 1 - Contract
Documents to be Taken as Mutually Explanatory.)
(4)
(5)
15
16
incorporated in the core provisions. (Adopted in Clause 5 - Subsurface and Ground Conditions.)
(6)
(7)
Construction Programme
Given the importance of agreeing to a programme of works at the
start of any contract. the Working Committee considered the
imposition of a sanction by way of a I 0% retention of monies due
until the compliance. (Adopted in Clause 9.4 - Failure to Submit
Adequate Programme.)
(8)
(9)
The Caveat
As the amendme_nts found in the 2005 edition are basically there to
addre~s the requtrements of the Building and Construction Industry
Secunty of Payment Act 2004, it is important to understand the Act and
its objectives especially the intended relationship between the statutory
payment scheme and the contractual payment scheme which parties may
agree to.
The Act is copied from the New South Wales' Act of the same name
with some fundamental differences. While the author's stand based on a
reading of the Singapore Act as compared with the New South Wales'
Act is that the statutory payment scheme cannot be activated on its own
the altem_ative view which is accepted by the BCA suggests otherwise:
Hence this stand accepted by the BCA appears to have influenced the
drafting of ~he PSSCO_c 2005. Therefore, it is expressly provided that the
Contractor IS to subrrut a Payment C laim under Clause 32.1 in order to
start ~e payment scheme whereas my comments at the relevant places
have indicated that a Payment Claim may be submitted in accordance
with its definition given by section 2 of the Act which, inter alia, requires
the Payment to contain the C laimed Amount which includes a claim for
~t~res~ in respect of the unpaid amount of a progress payment thereby
md1caung that a Payment Claim can only be submitted when there is a
9
Clause 1 -
Generally
10
Lewison, K, The Interpretation of Contracts (3rd ed. 2004, Sweet & Maxwell) p 139
of section 5.10.
Re George and the Goldsmiths and General Burglary lm11ra11ce Association ltd
[ 1899) I QB 595.
Adelphi (Estates) lid v Christie (1984) 269 EG 221
11
Defi nitions
It is expressly provided that the definitions given to the terms set o ut
be low from sub-clauses I. I (a) to I . I (ag) inclusive is for use in the
Contract only as defined in Clause I . I(d). Should there be any conflict or
inconsistency between the Conditions and o ther documents fonning the
Contract, the guidance given by C lause 3. 1 is thal the Conditions shall be
given precedence and within the Conditions, the Particular Conditions, if
any, shall be given precedence. Further, it is to be no ted that the
definitions given to the terms are no t absolule in that meanings other than
those assigned be low are applicable if the contexl requires.
Clause 1. l(a) - 'Appe ndix' means the appendix to these Condi tio ns
This definition is useful and practical co nsidering that in any building and
construction contracts, there are many sets of documents where it is no
uncommon to have appendix(ices). Hence thi s provision makes it clear
that reference to 'Appendix' in the Contract refers to only the Appendi x
to the Co nditio ns. What may be inconsistent with the use of the word
'Appe ndix' is the fact that it is not to be found together with the
Conditio ns but is actually part of another document referred to as
'Supplement'.
The term 'Appendix' is also found in the following defi nitions: subclauses l.l (c) 'Conditions', l.l (d) 'Contract', l.l (k) ' Defects Liability
Period ', l.l (m) 'Employer' and l.l (at) Time for Completion'.
Clause 1.1 (b) - 'Claimed Amou nt' means the whole or part of any payme nt
claimed by the Contracto r in a Payment Claim pursuant to Clause 32.1(1)
It is not usual and 1 would submit not recommended to define a term in
two places. In this case, 'Claimed Amount' is itself also defined in
4
5
Claus~ 32. l (l) as the amounts shown in the Contractor's Payment C laim
to which the Contraclor considers himself to be entitled to the last day of
the monthly interval in q uestion. thus by Clause l.l (b) 'Claimed
Amount' means the whole or part of the 'Claimed Amount' as defined in
Clause 32. l ( I).
It is also not usual and 1 would submit not recommended to defi ne
terms d ifferently fro m what is defined in statute when it is the declared
intention that the use of the said lerm is lo be in compliance with the
relev~t Act. By section 2 of the Building and Construction Industry
Secunty of Payme nt Act. 'Claimed Amounl' means 'the whole or part of
any progress payment [progress pay ment defined by the same section 2
as a pay.ment to which a person is enti tled for the carryi ng out of
construction work . . . under a contract, and includes (a) a single or oneoff payment; or (b) a payment that is based on an event or a date] claimed
by a. claimant in a payment claim. and includes any interest payable under
sectio n 8(5) [by section 8(5), 'The interest payable o n the unpaid amount
of a progress payme nt that has become due and payable ... " ]' . It is noted
that fundamentally, the Contractor does not claim for interest under
Clause 32. l ( I) and the payment claim required under Clause 32. l (I) is
not submitted after a progress payment has been unpaid when due and
payable.
This case may be aggravated by the fac t that section 36(2)(a) of the
Act provides. that ~ provision under which the operation of this Act or a ny
part thereof 1s, or is purported to be, excluded, modified, restricted or in
any way prejudiced, or that has the effect of excluding, modifying,
restricting or prej udicing the operation of this Act or any part thereof
shall be void.
The term 'Claimed A mount' is not used in the other defined terms.
Clause 1.1(c) - 'Cond itions' mea ns the Standard Conditio ns and Particular
Cond itions (if any) of Contract for Construction Work contained in the
Contract and Option Modu les specified in the Appendix
In draf~ing a defi.nition, it would be a good guide not to create a potential
confusion. In this case, 'Conditions' refer to Standard Conditions and
Particular Conditions (if a ny) contained in the Contract. However, when
one looks at the defi nition of 'Contract', one is told that the Contract,
inter alia, means Conditions and Appendix, thereby leaving no one wiser
as to how one wou ld determine whether there are any applicable
Particular Conditions and how these may be identified .
The term 'Conditions' is also fou nd in the following defini tions: subclauses l. l(a) 'Appendix', l.l(d) 'Contract', l.l(e) 'Contract Sum ',
I. I (h) 'Contractor's Representative' and I. I (r) 'Option M odule'.
See cl I. I.
See cl 1.2 and t.3.
See cl 1.4.
12
13
It is useful in this case to differentiate the use of the te1m 'equipment' and
'plant' by whether the subject matter concerned ends up as part of the
Works then.
The term 'Construction Equipment' is also found in the subclauses I. I (ae) 'Temporary Works'.
Clause 1.1 (e) - 'Contract Sum' means the lump sum set out in the Letter of
Acceptance, and shall be fixed subject only to adjustments expressly
provided for in the Conditions
There is potential for ambiguity as the term contract sum is also found in
the Agreement.
The term 'Contract Sum' is not used in the other defined terms.
Clause 1.1 (f) - 'Contractor' means the person or firm or corporation whose
Tender has been accepted by the Employer and includes the Contractor's
legal personal representatives and any person to whom the rights or
liabilities of the Contractor have been assigned or transferred with
agreement in writing of the Employer under Clause 30.1
This definition also provides for the possibility that the Contractor who
signed the Contract with the Employer may be replaced by another
contractor as permitted by Clause 30.1.
The term 'Contractor" is also found in the following definitions: subclauses 1.l(b) 'Claimed amount', l.l (h) 'Contractor's Representative',
1.1 (1) ' Drawings', l.l (m) 'Employer', l.l(o) 'Final Payment Claim',
J. J(q) ' Loss and Expense', J.l (s) 'Payment Claim', l.l(t) 'Payment
Certificate', l.l (w) 'Provisional Sum Items', l.l(x) 'Rates', l.l(ad)
'Te nder' and 1.1 (af) 'Time for Completion'.
14
15
The tenn 'Defect' is also found in sub-clause I.I (k) 'Defects Liability
Period'.
Clause 1.1 (n) - 'Final Account Certificate' means the document issued by
the Superintending Officer under Clause 32.5
Clause 1.1 (k) - ' Defects Liability Period' means the Defects Liability Period
set out in the Appendix hereof, calculated from:
(a) the Date of Substantial Completion of the Works certified by the
Superintending Officer in accordance with Clause 1 7; or
(b) in the event of more than one Certificate of Substantial Completion
having been issued by the Superintending Officer under Clause 17, the
respective Dates of Substantial Completion so certified
Clause 1.1 (o) - 'Final Payment Claim' means a claim for payment made by
the Contractor pursuant to Clause 32.4(1)
This definition should be improved by including the information given in
Clause 32.4(3) which provides that 'The Final Payment Claim made
under this Clause shall constitute a Payment Claim made under the Act,
provided always that the requirements for the Final Payment Claim made
are fully complied with under the Act' . As explained above at
Clause l. l(b) 'Claimed Amount'. the Final Payment Claim appears not to
qualify as a Payment Claim under the Act as a Payment Claim contains
the Claimed Amount which includes a claim for interest in respect of the
unpaid amount of the progress payment whereas the Final Payment
Claim is a fresh claim and not a claim for payment in respect of amounts
which are part of a progress payment that became unpaid.
The term 'Final Payment Claim' is not used in the other defined terms.
Clause 1. 1(p) - 'Letter of Acceptance' means the formal acceptance by the
Employer of the Tender
When read with the definition given by Clause l.l(ad) for 'Tender', there
appears to be some circularity in linking the definition of one term with
the other. If a Letter of Acceptance is a formal acceptance of the Tender,
one would expect the Tender to be that which 1s offered by the Contractor
in its original form. However, the definition of Tender is not that. Instead
Clause 1.1(ad) defines the Tender as the Contractor's offer as accepted by
the Letter of Acceptance. There lies the circularity of the definition. In
most situations, the original tender offer is adjusted after tender
interviews and/or further negotiations and it would be closer to reality
that the letter of acceptance accepts what may be called an
'adjusted/modified' tender. Perhaps definitions should seek to clarify
rather than offer ambiguity.
The term 'Letter of Acceptance' is also found in the following subclauses: l.l(d) 'Contract', l.l(e) 'Contract Sum', l.l(ad) 'Tender and
l.l(af) 'Time for Completion.
16
17
Clause 1.1 (m) - 'Employer' means the Government or the statutory body
specified in the Appendix
This definition should be read with Clause 22.2 which provides that the
Contractor is not entitled to recover any loss, expense, costs or damage
whatsoever except in accordance with the express provisions of the
Contract. It would appear that the above definition of Loss and Expense
defines what the Contractor may recover. lndeed. the above formula
would be used to the exclusion of a common law basis.
The term 'Loss and Expense' is not used in the other defined tenns.
Clause 1 .1 (r) - 'Option Module' means an Option Module appearing at the
end of the Conditions
This definition should be read with the definition of Clause 1.1 (c)
'Conditions where it is stated that an Option Module is part of the
Conditions only if specified in the Appendi x.
The term 'Option Module' is not used in the other defined terms.
Clause 1.1 (s) - 'Payment Claim' means a claim for payment made by the
Contractor pursuant to Clause 32.1(1)
As in the case of the definition given to 'Claimed Amount' in
Clause I. I (b). the comments for this clause are similar. It is not usual and
I would submit not recommended to define a term in two places. In this
case. 'Payment Claim' is itself also defined in Clause 32. 1(I) as a claim
for payment in such form as the SO may from time to time prescribe. It is
also provided that the Payment Claim shall have the same meaning as
ascribed in the Building and Construction Industry Security of Payment
Act 2004 and that it should show the amounts to which the Contractor
considers himself to be entitled up to the last day of the monthly interval
in question.
It is also not usual and I would submit not recommended to define
terms differently from what is defined in statute when it is the declared
intention that the use of the said term is to be in compliance with the
relevant Act. By section 2 of the Act, 'payment claim' means 'a claim
made by a claimant for a progress payment [progress payment is defined
by the same section 2 as "a payment to which a person is entitled for the
18
Clause 1.1 (w) - 'Provisional Sum Items' means items of work which shall
only be executed or provided upon instruction in writing by the
Superintending Officer who may decide that the work in whole or in part
or not al all may be carried out by the Contractor
The term 'Provisional Sum Items' is not used in the other defined terms.
Clause 1.1 (x) - ' Rates' means those in the Schedule of Rates or the rates
and prices contained in Bills of Quantities, whichever is applicable,
including any modifications or additions thereto agreed in writing by the
Employer and the Contractor
The term Rates' is not used in the other defined terms.
This case may be aggravated by the fact that section 36(2)(a) of the
Act provides that a provision under which the operation of this Act or any
part thereof is, or is purported to be, excluded, modified, restricted or in
any way prejudiced, or that has the effect of excluding, modifying,
restricting or prejudicing the operation of this Act or any part thereof,
shall be void.
The tem1 'Response Amount' is not used in the other defined tenns.
Clause 1.1 (z) - 'Site' means the lands and other places on, in, under, over
or through which the Works are to be executed or carried out or any other
lands or places provided by the Employer for the purposes of the Contract
The term 'Site' is also found in Clause l.l(q) 'Loss and Expense'.
Clause 1.1 (y) - 'Response Amount' means the amount that the
Superintending Officer proposes to pay to the Contractor in the Payment
Certificate issued pursuant to Clause 32.2(1)
As in the case of the definition given to 'Claimed Amount' in
Clause 1.1 (b) and that given to 'Payment Claim' in Clause I. I (t), the
comments for this clause are similar. It is not usual and I would submit
not recommended to define a term in two places. ln this case, Response
Amount' is itself also defined in Clause 32.2(1) as the amounts which
may consist of deductions of any sums which have been or may become
due and payable by the Contractor to the Employer under the Contract or
otherwise to which the Contractor is, in the SO's opinion, entitled in
respect of the Claimed Amount.
It is also provided that the Payment Certificate issued by the SO shall
fully comply with the requirements for Payment Response made in
contemplation of the Building and Construction Industry Security of
Payment Act 2004.
It is also not usual and I would submit not recommended to define
tenns differently from what is defined in statute when it is the declared
intention that the use of the said term is to be in compliance with the
relevant Act. By section 2 of the Act, 'response amount' means, in
relation to a construction contract, the amount that a respondent proposes
to pay to the claimant in a payment response provided under
section 11 (I) or 12(4) or as varied under section 12(4 ).
It would appear that what the SO certifies is not what the respondent
proposes to pay to the claimant but the SO's opinion as to what the
Contractor is entitled. Therefore, it is submitted that the SO's Payment
Certificate does not contain the statutory Response Amount.
Further, under section 11(1), a respondent shall respond to a payment
claim. However, if as explained above, the payment claim as provided by
the Contract is not as prescribed by the Act for the reasons stated above,
then the SO's Payment Certificate may not qualify as a Payment
Response as it would not be responding to a statutory Payment Claim.
20
Clause 1.1 (ad) - 'Tender' means Lhe Contractor's offer to the Employer to
design (to the extent provided for by the Contract), execute and complete
the Works for a lump sum as accepted by the Letter of Acceptance
Please see the discussion for sub-clause l. l(p) 'Lener of Acceptance'
above.
The tenn 'Tender' is also found in the following sub-clauses: I.I (d)
'Contract', 1.1 (t) 'Contractor' and J.l (p) 'Letter of Acceptance'.
7
8
See cl 1.2.
See cl 1.3.
9
22
-~~~~~~~~~~~-
See cl 1.4.
23
Generally
25
This clause has eight sub-clauses. This clause basically defines the role of
the Employer's3 agent. By Clause I. I(ab) 'S uperintending Officer' means
the person. firm or corporation appointed as such by the Employer for the
purposes of the Contract4 and Clause J.J (ac) 'S uperintending Officer's
Representative' means the person, appointed from time to time by the SO
under Clause 2.2.
There are two limbs to the first sub-clause, 2.1. The first limb provides
for the express and implied authority of the SO. It also prescribes that any
limitations on the SO's authority be set out in the Appendix. 5 The second
limb expressly provides that the SO has no power to relieve the
Contractor6 of any of his obligations under the Contract unless it is
expressly stated in the Contract.
The next sub-clause, 2.2, creates the SO's Representative (SO's Rep).
The SO"s Rep is appointed by the SO and not the Employer. The SO's
Rep is responsible to the SO. This sub-clause expressly allows the SO to
delegate such duties and such authority but pursuant to the next following
sub-clause.
The SO's right to delegate is itself authorised in sub-clause 2.3. The
SO may from time to time delegate to the SO's Rep such duties and
functions vested in the SO other than those listed in the Appendix
pursuant to Clause 2.1. The SO has the corresponding right to revoke
what he has delegated. In both cases, it is not effective on the Contractor
until a copy of such delegation or revocation has been delivered to the
Contractor. It is expressly provided that any act done by the SO's Rep in
accordance with the delegation has the same effect as though it had been
done by the SO. However, there are twp exceptions. The first is that the
failure of the SO's Rep to disapprove any Plant,7 materials, goods or work
does not prevent the SO from disapproving the same. The second is that
should the Contractor dispute any act of the SO's Rep, the Contractor
may refer the matter to the SO who shall confirm. reverse or vary the act
3
4
S
6
7
26
27
Clause 2
Contractor
Role of the SO
Subject to any limitations on his a uthority, the SO's authority is expressly
set out by this clause as 'that stated in or necessarily to be implied from
the Contract' . 14 Any limitations should be set out in the Appendix in
relation to Clause 2.1. 1s The SO has no authority to relieve the Contractor
of any of his obligations under the Contract unless expressly allowed for
in the Contract. 16
Generally, the SO is empowered by this clause to delegate 17 any of the
duties or functions vested in him (subject to the limitations provided by
Clause 2.1) to a Superintending Officer's Representative (SO's Rep) who
shall be appointed by him. 18 Once delegated, any act done by the SO's
Rep carries the same effect as though it is done by the S0. 19 Both the SO
and the SO's Rep may in tum appoint in writing any number of assistants
to assist the SO's Rep in the carrying out of his duties. 20 If such assistants
are to have any authority to issue instructions to the Contractor, the SO
must authorise this in writing.
The authority of the SO to disapprove any Plant, materials, goods or
work, or to instruct for rectification, is not prejudiced by any failure of the
SO's Rep to disapprove the same. rn the event that any act of the SO's
Rep is disputed by the Contractor the matter shall be referred to the SO
who shall then either confirm, reverse or vary the act or decision of the
SO's Rep. 21
See cl 2.5.
See cl 2.5.
See cl 2.3(b).
11
12
13
14
15
16
17
18
19
20
21
See cl 2.6(a).
See cl 2.6(b).
See cl 2.8(1 ).
See cl 2.1(1).
See cl 2.1(1)
See cl 2.1(2).
See cl 2.3.
See cl 2.2.
See cl 2.3.
See cl 2.4.
See cl 2.3(b).
28
29
The SO's Rep is to carry out any of the duties or functions vested in the
SO other than those listed in the Appendix pursuant to Clause 2.1 which
have been delegated to him by the SO and not subsequently revoked.
Role of assistants
The role of assistants is to assist the SO's Rep in the carrying out of his
duties. However, they shall have no authority to issue any instructions to
the Contractor save insofar as such instructions may be necessary to
enable them to carry out their duties and to secure that the Plant,
materials, goods or work are in accordance with the Contract.
Cross References
The only other contract document expressly referred to in this clause is
the Appendix.
22
23
24
See cl 2.5.
See cl 2.5.
See cl 2.8(1 ).
JO
Generally
Parties may choose to enter into oral contracts. written contracts or part
oral and part written contracts. IL is usual for parties to enter into written
contracts in respect of building and construction contracts as each party's
consideration is not simple and therefore it may not be practical to have
an oral contract to describe the same. Consequently the standard form of
building and construction contracts came about. However, the standard
form is not the only document.
Two other documents usually form part of the set of contract
documents that bind the parties. These are the drawings and
specifications from which the builder will construct the structure(s)
depicted in the drawings and using the materials described in the
specifications.
In addition, there may be another document known as the bills of
quantities which contain the quantities measured in accordance with the
applicable Standard Methods of Measurement and the rate and amount of
each measured item. Alternatively, there may be a schedule of rates of
items of work. There may also be other documents containing other terms
of the contract which the parties agree to after some negotiations.
As variations may be said to be inevitable in any building and
construction contract, there may be a need to issue further drawings and
specifications. It is also not unusual that further drawings and
specifications are issued as a result of inadequate details in the original
set of drawings and specifications.
The importance of the contract documents cannot be understated as the
final product is dependent upon the ability to manifest design in terms of
drawings and specifications, while the allocation of risks in terms of legal
obligations and liabilities on the one hand and rights and remedies on the
other are set out in the standard form containing the terms and conditions
of the contract. Hence seeking the intended meaning from the documents,
whether in text or drawing, is important.
Where special conditions are added to standard forms of contract,
a canon of construction accepts that 'greater weight must be given to the
special conditions, and in case of conflict between the general conditions
31
and the special conditions, the latter will prevail' .1 It is also open to the
parties to exclude any rule of interpretation, eg the contra profer~ntem
rule. Although generally no special priority is accorded to any parucular
document within a set of contract documents, this does not however
prevent standard forms from attempting to accord some priority to certain
documents by expressly providing for it.
Another important function of the drawings and si><:cifications a~d
further drawings and specifications is to allow the parties to ascertam
changes from the original scope of work with a view to ?perate ~e
variation provisions. Related to this p~int are th~ documents .Like the. bills
of quantities and schedule of rates which contam rates of pnces of items
of work and materials which would be relied upon to calculate the cost of
the variation.
The final point is the question of confidentiality and the protection of
intellectual property in the subject matters contained in the contract
documents.
Lewison. K. The /11rerprera11on ofComracts (3rd ed. 2004. Sweet& Maxwell) p 162.
For definition of Conditions, see cl I I (c).
For definition of Appendix. see cl 1.l(a).
For definition of Specifications, see cl I. I (aa).
For definition of Drawings. see cl 1.1 (I).
For definition of Tender. see cl I. I (ad).
For definition of Lel!er of Acceptance, see cl I. I (p).
For definition of Superintending Officer, see cl 1. l(ab).
32
JO
Il
33
Clause 3
Comract Doc11111e111s
Contractor
Employer
(I)
(2)
12
13
See cl 3.2(1).
See cl 3.2( I).
14 See cl 3.3.
IS See cl 3.4.
16 See cl 3.5.
Superintending Officer
Role of the SO
By Clause 3.2, the SO is to be the sole custodian of the Drawings.
Further, the SO is empowered to give consent to the Contractor in respect
of the use by and commu nicauon to third a party. The SO is to write for
further copies of Drawings. Specifications and other documents in
respect of the Works which are designed by the Contractor in accordance
with Clause 6.2.
. Beyo~d the b_asic set of Contract Documents, the SO is required from
t:Ime to time to issue to the Contractor such further or revised drawinos.
specifications or instructions necessary for execution and completion of
the Works. 17
~hile the SO is expected to comply with the requirements of any
notice for further drawings and information under this clause, there is a
proviso that such notice must be given in sufficient time for the SO
reasonably to prepare and issue the information required. a
Where his non-compliance and/or non-performance has led to the
progress or completion of the works being materially affected. the SO
may grant an ex tension of time pursuant to Clause 14 and may certify for
Loss and Expense pursuant to Clause 32.19
Cross References
The clauses expressly referred to in this clause are Clauses 6.2
(Submission of Documents Prior to Commencement),20 9 (Programme
17 See cl 3.5.
18 See cl 3.4.
19 See cl 3.6.
20 See cl 3 2(2)
)
34
Generally
21
22
23
24
See cl 3.4(b).
See cl 3.6.
See cl 3.6.
See cl 3.6.
36
37
the Works, the contractor has to provide the necessary materials, labour,
plant and equipment, and superintendence and site co-ordination, and has
to choose the methods of working and site operation required
appropriately under the circumstances.
Unless otherwise provided, the contractor must use reasonable care
and skill to carry out his work and he must supply materials that are of
good quality and be reasonably fit for the purpose for which it is used.
Thus, in Management Corporation Strata Title Plan No I 166 v Chubb
Singapore Pte Ltd, 1 GP Selvam J held that '[t]he standard of due care and
diligence, that is the standard of reasonable care and skill, is selfexplanatory. The standard is applicable to contracts for works and
services where the predominant feature is the application of mental or
physical effort and experience'. It was further held (at pp 563 and 564)
that 'A contract for work and materials is a contract the subject matter of
which is the perfol111ance of services, even though it incidentally includes
the sale or supply of some goods. Performance of work and services is the
primary contract. It is well accepted that a contract for the construction
or renovation of a land structure is a contract for work and materials and
not sale or supply of goods. It is settled law that according to the
principles of the common law, in a pure contract for work and materials
the following warranties will be implied into it: (a) that the materials used
wi ll be of good quality (equivalent to merchantable quality in sale or
supply of goods contracts); (b) that the materials are reasonably fit for the
purpose for which they are used (equivalent to fitness of purpose of
purchase in sale or supply of goods contracts)'.
However, where the performance of the contract is subject 'to the
satisfaction of the SO', there is no room for any objective standard as the
view of the particular SO is the prescribed criterion. 2
This clause has seven sub-clauses. This clause identifies the general
responsibilities of the Contractor. 3 Related to this Clause is Clause 25
(General Responsibilities). Thus, first sub-clause, 4.1. is an elaboration of
Article 4 of the Agreement which provides that 'the Contractor hereby
covenants with the Employer to design (to the extent provided for by the
Contract5 ) execute and complete the Works6 and remedy any defects
therein in conformity with all respects with the provision of the Contract'.
lt expressly states that it is the Contractor who provides all
I
2
3
4
5
6
38
39
(l)
(2)
design (to the extent provided for by the Contract), 16 execution and
completion of the works; and
remedy of any defects in the Works. 17
(3)
(4)
See cl 18 (Defec1s).
18 Sec cl 4. l.
Contrac tor
Contractor's obligations and liabi lities
Generally, the Contractor is responsible for:
14
15
40
19
See cl 14.2 (Extension of Time for Completion) where the term used is "due
diligence' and cl 31.l(c) (Temunation for Default) where the term used is "due
cliligenceand expedition'.
20
21
22
23
24
25
26
41
Employer
Employer's obligations and liabilities
27
28
42
43
Clause 4
Cross References
!rom
Role of the SO
When the SO receives a notice from the Contractor about any ambiguity,
discrepancy, conflict, inconsistency or omission in or between any_of the
Contract documents, he, insofar as it may affect the execution or
completion of the Works, must explain and adjust it and may issue to the
Contractor an instruction so as to resolve the same.
In connection with this, the SO must consider, where applicable:
( J)
(2)
38
39
40
41
42
43
44
See cl 4.4(2).
See cl 4.5(3).
See cl 31. 1(2)(c).
See c l 4.5(4).
See c l 32 (Progress Payment and Final Account).
See cl 4.4( I). For extension of !Jme, see cl 14 (Time for Completion).
See cl 4.4(2).
44
45
46
47
48
49
50
51
52
See cl 4.4(3).
See cl 4.5(2) and 4.5(3)(i).
See cl 4.5(3)(ii).
See cl 4.6.
See cl 4.4( 1).
See cl 4.4(2).
Seecl4.4( 1).
See cl 4.4( 1) and 4.4(2).
45
Generally
Construction and building works may be divided into two types for
discussion in this chapter. First, the execution and completion of the
works may take place without any obstruction. eg construction above
ground where there is no existing structures. Second, the execution and
completion of the works is carried out in a situation where an existing
structure has to be removed before the commencement of the works or
where the work is carried out on ground where the soiJ or whatever exists
in the soil would have to make way fo r what is to be constructed in the
ground.
What is in the ground may be naturally occurring or a man-made
object placed in the ground. Where it is the latter. the man-made object
may still be in use. It can be a water pipe or a sewer. Therefore, the
condition of the ground would affect the method of construction required
to carry out the works and the level of difficulty in which such works are
carried out. It has a direct bearing on the cost of construction.
Hence, it would reduce the risk of pricing a tender, if what is in the
ground is known. As far as man-made objects are concerned, there ought
to be as-built drawings of services and other records of the presence of
such man-made objects. However, in practice, it is not uncommon to find
that such information is unavailable or may be inaccurate. As regards
what naturally exists in the ground, experience has shown that sample
bore holes may not adequately reveal the profile and composition of what
is in the ground . Until new technology is available that is cheap and
reliable, the risk of encountering unforeseeable ground condition is there.
That being the case, parties to a building and construction contract that
require underground works have to allocate the risk of encountering
unforeseeable ground conditions. In many instances, the contractor is to
bear any extra cost arising from this encounter. However, some have
chosen to identify certain parts of this risk and to compensate the
contractor in a limited way. If the latter is pursued, then a mechanism for
the contractor to claim including a prescribed way of assessment of the
amount of compensation must be provided.
47
Contractor
This Clause has lwo sub-clauses. C lauses 5. 1 and 5.2 have been amended
while Clause 5.3 is a new clause inserted by the 2004 edition. The 2004
edition inserted in Clause 5.1 the provision that geotechnical information
may be provided by the Employer' but the. Con~act?r2 is not relieved of
his responsibility to carry out his own mvest1gat1ons: In Cla~s~ 5.~,
'artificial obslructions' was replaced by 'adverse physical conditions .
Further, the definition of the latter term is given in Clause 5.2. Clause 5.3
provides for underground services.
In the first sub-clause, 5.1 , inspection and examination of the site and
its surroundings is primarily the duty of the Contractor and he is deemed
to have done so before he submits his tender.3 The Contractor must have
satisfied himself as to the nature of the ground and the sub-soil and the
form and nature of the Site4 before submitting the Tender. 5 It is further
provided that the Employer may provide geotec.hnical info:11ation
concemin" the Site although the Contractor re mains responsible for
carrying o"'ut his own investigation and/?r search for exi~ting and oth~r
additional information relevant to the Sile. Related to this sub-clause is
C lause 4.6 which provides that the Contractor must be satisfied that his
Tender is able to cover all his obligations under the Contract.
The next sub-clause. 5 .2, provides for the Contractor to claim both
ex tension of time and Loss and Expense if the Contractor encounters
adverse physical conditions in the prescribed cir~ums ta_nces. Adverse
physical conditions is defined in this sub-clause as mcludmg ~nfores~en
sub-surface and ground conditions and all underground services ~hi~h
are in use. The conditions imposed on the Contractor to succeed m his
claim are that the adverse physical conditions could not have been
reasonably foreseen by an experienced contrac~or and that ~e Contractor
is of the opinion that additional cost will be incurred which would not
have been incurred if such adverse physical conditions had not been
encounte red. The Contractor must also comply with the requirements of
C lauses 14. 23 and 32.
Jn the last sub-clause, the Employer may provide information on
underground services obtained from the relevant service providers to ~e
Contractor. However, there is a caveat which protects the Employer rn
that the Contractor is not relieved of his responsibility of engaging
licensed cable/services detection workers to carry out all cable/services
detection work. Further, the Contractor is to bear all costs and charges in
respect of any damage to the underground services.
2
3
4
5
For definition
For definition
See cl 5.1.
For definition
For definition
48
(2)
the adverse physical conditions are those which could not have been
reasonably foreseen by an experienced contractor; and
the Contractor is of the opinion that additional cost will be incurred
which would not have been incurred if such artificial obstructions
had not been encountered.8
However, the sub-surface works that this clause relates to must not be
those that form part of Works9 for the design of which the Contractor is
responsible under Clause 6.1 (Contractor's Design Responsibility).
Artificial obstructions are also deemed to exclude all underground
servi ces which are in use or would be in use.
As soon as possible after the giving of the notice, the Contractor is
expected lo follow up with a number of actions hy giving details of:
( J)
(2)
(3)
It would appear from Clause 5.3 that the Contractor remains responsible
for engaging licensed cables/services detection workers to carry out all
cable/detection work regardless of whether information on underground
6
Seecl5. I.
For definition of Superintending Officer. see cl I. I (ab).
8 See cl 5.2.
9
For definition Works, see cl I. I (ag).
IO See cl 5.2.
7
49
The clauses expressly referred to in this clause are Clauses 4.2 (Site
Operations and Methods of Construction), 6.1 (Contractor's Design
Responsibility), 14 (Time for Completion), 23 (Procedure for Claims)
and 32 (Progress Payments and Final Account). 1 ~
Claus 5.2 is mentioned in Clauses 4.6, l 4.2(p) and 22.1 (g).
Employer
Role of the SO
Essentially, the SO is required to make an assessment of whether the
adverse physical conditions are such that they could not have been
foreseen by an experienced contractor. lf he is of the opinion that this is
the case, the SO may grant an extension of time and certify a sum for loss
and expense for complying with his instructions and for taking proper
11
12 See cl 5.2.
See cl 5.2.
50
51
Generally
There are two different standards imposed on designers. First, where the
designer is offering his professional service in respect of design, he is
required to use reasonable skill and care to carry out his design work with
no guarantee that the finished product would perform the function
required by his client unless there are special circumstances recognised
by the Jaw as imposing upon him a higher standard of care. However, if a
contractor offers to design and build either by himself or through a subcontractor, then he warrants that the finished product is fit for the purpose
for which the structure is being built.
Thus in George Hawkins v Chry1sler (UK) Ltd and Burne Associates
(afirm), 1 Neill U said '[i]t is also clear that a professional man may be
liable on the basis of an implied warranty of fitness for purpose if his
contract extends not merely to design of an article, but also to its supply
or manufacture. (See, for example, Samuels v Davis [1943] KB 526.)
Furthermore it is now established that a contractor, who has agreed to
design and erect a building or other structure, may be liable for breach of
an implied warranty that the building or structure is fit for a particular
purpose, even though the contractor took no part in the design work,
which was carried out by a specialist sub-contractor (see IBA v EM!
[1980] 14 BLR I). ' I have come to the firm conclusion, however, that it
is not open to this court, except where there are special facts and special
circumstances, to extend the responsibilities of a professional man
beyond the duty to exercise all reasonable skill and care in conformity
with the usual standards of his profession.' 2
I
2
This clause has four sub-clauses. While this is a traditional contract and
not a design-and-build contract, it is nevertheless envisaged that the
design of the whole or part of the Permanent Works be given to the
Contractor. 3 By Clause l.l(u) 'Permanent Works' means the works of a
permanent nature (including Plant) to be executed in accordance with the
Contract.
The first sub-clause, 6.1, defines the responsibility imposed on the
Contractor where the Contract4 expressly provides that the whole or part
of the Permanent Works is to be designed by the Contractor. It is
expressly provided that the Contractor is fully responsible for the
suitability, adequacy, integrity and practicality of the design as set out in
the Drawings,5 Specifications, 6 manuals. calculations and other
information submitted for acceptance by the Superintending Officer
(S0)7 including any subsequent amendments. Related to this clause will
be Clause 4.7 (Patents, Trademarks, Copyrights, etc) where the
Contractor must defend, indemnify and save harmless the Employer8
from and against all claims and proceedings on account of infringements
of any intellectual property rights as prescribed.
By Clause 6.2, the Contractor is required to submit such Drawings,
Specifications, manuals, calculation and other information as may be
necessary to demonstrate the suitability, adequacy, integrity, durability
and practicality of such design. Further, the Contractor's design must be
accepted by the SO before the Contractor can commence work although
this acceptance does not relieve the Contractor of any of his
responsibility. In any event, acceptance by the SO does not relieve or in
any way limit the responsibility of the Contractor under Clause 6.1.
The next sub-clause, 6.3, regulates the documents which the
Contractor is required to submit at the Date of Substantial Completion9 as
prescribed. In particular, the Contractor must submit operation and
maintenance manuals together with Drawings of the Permanent Works
designed by the Contractor. They must be in sufficient detail to enable the
Employer to operate, maintain, dismantle, reassemble and adjust the
Permanent Works.
The last sub-clause, 6.4, prescribes the contractual remedy for any
deficiency of any kind or nature of the design. The sub-clause provides
that the SO may instruct the Contractor at any time, before, during or
after the execution and completion of the Works to amend or modify the
3
4
5
6
7
8
9
54
10
11
12
13
14
See cl 6. I.
See cl 6.2.
See cl 6.2.
For definition of Works, see cl I. I (ag).
See cl 6.3.
55
Employer
Role of the SO
In this clause, there are three aspects of the SO's role. First, the SO must
consider whether to accept the Contractor's design or any subsequent
amendments. The criteria to be used by the SO to decide whether to
accept the Contractor's design are that the Drawings, Specifications,
manuals, calculations and other information must demonstrate the
suitability, adequacy, integrity, durability and practicality of the design.
Thus, until the criteria are met, the SO is not obliged to issue his
acceptance. 15
Second, the SO must consider whether to accept the Contractor's
submission of operation and maintenance manuals together with
Drawings of the Permanent Works designed by the Contractor. The
criterion to be used by the SO to decide whether to accept the
Contractor's said submission is that the submitted documents must be in
sufficient detail to enable the Employer to operate, maintain, dismantle,
reassemble and adjust the Permanent Works incorporating the
Contractor's design. Once this criterion is met, the SO must issue his
acceptance. 16
17
18
15
See cl 6.4.
See cl 6.2.
19 See cl 6.1.
20 See cl 6.1.
See cl 6.2.
16 See cl 6.3.
56
57
Generally
The design, construction and completion of any building and construction
works are highly regulated primarily for health and safety reasons. In
addition, there are regulations in respect of water, electricity and gas.
There may also be prescriptions for height and even civil defence
shelters.
The Contractor has to comply with a whole range of statutes and
regulations relating to construction work in any typical construction
project. The governing legislation and subsidiary legislation, to name a
few, would include the Building Control Act, 1 Building Control
Regulations, Factories Act2 and Factories (Building Operations and
Works of Engineering Construction) Regulations.
The Contractor in pricing his tender is expected to incorporate the cost
of such compliances. Therefore. all fees and charges relating to
compliance with these are generally the responsibility of the Contractor,
and only in so far as they result in a need to vary the work that is not
foreseeable will they be dealt with as valid variations for which the
Contractor is paid. Thus. if the time for completion is long, it may be
possible that new laws may come about imposing requirements that has
not been envisaged by the Contractor at the time of tender.
Intention of the Clause
This clause has three sub-clam.es. In the first sub-clause, 7 .1, all the
necessary notices required by any law, regulation or bye-law, or by any
public authority or public service company, relating to the Works, 3 are to
be complied with and given by the Contractor. 4 The clause spells out this
basic responsibility of the Contractor as well as his responsibility to pay
1
2
3
4
59
and indemnify the Employer5 against any fees or charges imposed by the
said notices.
The second sub-clause, 7.2, provides for the situation where variations
from Lhe Drawings6 and Specifications7 are needed for such compliance.
It is provided that the Contractor cannot proceed with the work without
first giving a written notice to the Superintending Officer (S0). 8 It is
further provided that there may be a deemed variation situation to be
processed pursuant to Clause 19 and dealt with as such. if the variation
necessitated could not have been reasonably foreseen by an experienced
contractor at the time of submission of the Tender.
The third sub-clause, 7.3, is a unique provision since the PSSCOC
2005 edition is a standard form for public sector projects where the
Employer may very well be the body that is responsible for the
enforcement of the relevant law, regulations or byelaws. Accordingly, the
sub-clause makes it clear that the responsibility imposed by Clause 7. I
still applies even if the relevant written law is enforced by the Employer.
Further, the Employer would not be liable for any default or delay arising
from the enforcement or implementation of the written laws.
The Employer's obligations and liabilities, as set out in Clause 19, will be
applicable here under Clause 7.2 if there is a deemed variation situation.
It is also expressly stated by Clause 7.3 that the Employer would not be
liable for any default or delay arising from the enforcement or
implementation by the Employer of any law. regulation or byelaw.
Contractor
8
9
10
JI
60
Superintending Officer
Role of the SO
When the SO receives a notice in writing from the Contractor specifying
and giving the reasons for making a variation from the Drawings and
Specifications in order to comply with such legal or statutory
requirements, the SO has seven days to deal with the application and to
respond with the necessary instructions to deal with it. 15
Although not expressly stated, in order to determine whether the
variation should be classified as a deemed variation under Clause 7 .2, the
SO will have to assess whether any variation necessitated could have
been reasonably foreseen by an experienced contractor at the time of
submission of the Tender as well as decide whether or not the variation is
12
13
14
15
Generally
Reference points, Jines and levels are lhe requisite starting points for lhe
proper location and execution of construction works. Once defined in lhe
documentation, achievement of the accurate and correct setting out is lhe
full responsibility of the Contractor as constructor of the works.
Intention of the Clause
The Contractor's obligations for accurate setting out are three fold at the
outset:
( 1)
(2)
(3)
16 Seecl7.2.
I
2
3
4
accurate setting out in relation to the original points, lines and levels
of reference provided by lhe SO in writing;
ensuring correctness of position, levels, dimensions and al ignment
of all parts of the Works; and
provision of all necessary instruments, equipment, apparatus and
labour in connection wilh these responsibilities. 5
See cl 8.1
For definition of Works, see cl I. I(ag).
For definition of Contractor, ~ce cl I. I(f).
For dcfini1ion of SO, see cl l.l(ab); see also cl 8.2.
Superintending Officer
Generally
Role of the SO
The programme for the works which is prepared by the contractor usually
contains the commencement date and the completion date as proposed by
the contractor. It usually contains the sequence of work chosen by the
contractor and may also indicate the methods of working adopted by the
contractor. If the information found in the programme is binding on the
employer either by the express provision of the contract between the
parties or otherwise, he would be obliged to give possession of site to the
contractor on or before the commencement date provided by the
contractor. Further, in a traditional contract where the employer is
responsible for design, he must ensure that his designers supply the
design information as and when required as indicated in the programme.
Where there is no express provision relating to the effect of the
progranune, it was held in Glenlion Construction Ltd v The Guinness
Trust 1 that there was no implied term of the contract between the
contractor and the employer that, if and so far as the programme showed
a completion date, before the date for completion the employer by
himself. his servants or agents should perform the said agreement as to
enable the contractor to carry out the works in accordance with the
programme and to complete the works on the said completion date.
The original reference points that form the basis for setting out are to be
provided by the SO in writing. 7 In the event that errors appear in relation
to position, levels, dimensions or alignment during the course of the
Works, the SO may require the Contractor to rectify tbem. 8
Cross References
This clause has four sub-clauses. This clause regulates the programme for
the Works. 1 It prescribes the mechanism for submission, approval and resubmission until the Superintending Officer (S0) 3 accepts the
program.me or it is deemed accepted as well as the consequences of
acceptance and failure to submit an adequate programme. It also
prescribes for revision. The purpose of the programme for the works is
5
6
7
8
See cl
See cl
See cl
See cl
8.1.
8.2.
8.1 (a).
8.2.
I
2
3
64
65
not found in this clause. However, by Clause 12. J. the parties are bound
to treat the programme or any revised or modified programme accepted
by the SO as the guide to determine whether the Contractor' has
proceeded with the works with due diligence and expedition and without
delay in accordance with the Contract. 5
The first s ub-clause, 9.1. has three limbs. The first limb, 9.1 (I).
prescribes that the Contractor should submit a programme to the SO in
the form and in compliance with the requirements specified in the
Contract or otherwise prescribed by the SO within 30 days after the date
of the Letter of Acceptance6 or such other time as the SO may reasonably
require. It is to be noted that by Clause 12.1 , the Contractor can only
proceed with the works in accordance with a programme that has been
accepted by the SO. Presumably, the Contractor cannot proceed if the
programme has yet to be accepted.
This programme is relied on in three other clauses. First, under
Clause 14.3( I), the Contractor, in his application for extension of time,
must inform the SO, inter alia, the effect of the delay event on the
programme accepted unde r Clause 9 (Programme for the Works).
Second, where, in the opinion of the SO, the rate of progress of the
Works or any phase or part of the Works is at any time too slow to achieve
completion by the Time for Completion,7 he shaJI notify the Contractor
under Clause l 5.1 and the Contractor shall thereupon take such steps as
are necessary to expedite progress. Such steps include, if required by the
SO, the preparation of a revised or modified programme for acceptance
by the SO.
Third, the SO may issue a Termination Certificate8 if in his opinion,
the Contractor has failed to comply with his obligations under Clause 9 or
has failed to execute the Works in accordance with a programme accepted
under Clause 9.9
The second limb, 9.1 (2), provides for the SO to notify the Contractor
in writing pursuant to C lause 36.2(3) whether the programme is accepted
or found to be unacceptable. Alternatively, if there is no reply from the
SO, the programme is deemed to be accepted.
The third limb, 9.1(3), it is provided that the SO should include in his
notice, his reasons for rejecting the programme. This wou ld trigger the
requirement imposed o n the Contractor to s ubmit a further programme
for the SO's consideration. Then it is provided that the whole cycle is
repeated if the SO finds the programme unacceptable.
The second sub-clause, 9.2, regulates the revision or modification of
the programme during the progress of the Works. Therefore, the SO may
5
6
7
8
9
66
Contractor
Contractor's obligations and liabilities
The Contractor is respo nsible for submitting an original programme for
the Works and any subsequent revisions as prescribed. In respect of the
original prog ramme, the Contractor must submit to the SO within 30 days
after the date of the Letter of Acceptance or such other time as the SO
may reasonably require. The programme must be in the form and in
compliance with the requiremenls specified in the Contract or otherwise
required in writing by the S0. 11 Whenever the SO requires, the
Contractor must furni sh the SO such particulars and information as the
SO may reasonably require for the purpose of determining the
acceptability of the programme for the Works. 12
The Contractor's next obligation to act depends on the SO's response.
The Contractor does not need to act until a revision of the programme is
necessary if either the SO accepts the programme or the re is no response
from the SO as the programme is deemed to be accepted. 13 If the SO
gives his reasons for rejecting the programme. the Contractor is obliged
to re-submit a programme after taki ng into account the SO's reasons for
rejection within 14 days of receiving the SO's notification of rejection. If
the re-submitted programme is not acceptable, the procedure is repeated.
JO For definition of Employer. see cl l . l (m).
11 See cl 9. 1(1).
12 See cl 9. 1(1).
13 See cl 9. 1(2).
67
this contractual right is available without prejudice to any other rights and
remedies which may be available to the Employer or the S0. 18
The Employer's right to terminate the Contract as prescribed in
Clause 31. I (2)(c) (Termination for Default) and pursuant to the SO's
Termination Certificate given as a result of the Contractor's noncompliance with his obligations under Clause 9 or his failure to execute
the Works in accordance with a programme accepted under Clause 9 as
prescribed in Clause 31.1 (l )(c) (Termination for Default) is not waived or
fettered by the acceptance of the SO of the programme or of any revised
or modified programme under Clause 9.
Seecl9.1(3).
See cl 9.2.
See cl 9.3.
Sec cl 9.3.
68
Superintending Officer
Role of the SO
ln this clause, the role of the SO covers three areas, namely, matters
relating to the original programme. matters relating to the revised or
modified programme and the consequences of the Contractor's failure to
comply with the requirements of this clause.
In respect of the original programme. the SO may first decide to
prescribe a form in which the Contractor is to submit the same and any
other requirements concerning the programme. 19 He may also decide
reasonably to prescribe a time other than 30 days after the date of the
Letter of Acceptance for the Contractor to submit the said programme for
the Works. 20 The SO is also empowered to require the Contractor to
furnish him with further particulars and information for the purpose of
determining the acceptability of the programme for the Works. 21
The SO is obliged to notify the Contractor within 30 days of receiving
the programme and any further particulars and information in relation to
it, whether the programme is acceptable or unacceptable, failing which, it
shall be deemed to be accepted. 22 lf the SO finds the programme not
acceptable, he must notify the Contractor of his reasons for rejecting it. 23
ln response. the Contractor must submit to the SO a programme
acceptable to the SO within 14 days of receiving the said notification
from the SO. The SO in tum is obliged to notify the Contractor within 14
days of receiving the further programme from the Contractor whether the
programme is accepted or unacceptable, failing which, it shall be deemed
to be accepted. If it 1s not acceptable, the same procedure is repeated. 24
18
19
20
21
22
23
24
See cl 9.4.
Seecl9.l(I).
See cl 9. 1(1).
Seecl9.1(1).
Seecl9.1(2).
Sec cl 9.1 (3).
See cl 9.1(3).
69
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Public Sector Standard Conditions of Comract for Construction \Vorks 2005
25
26
27
28
29
30
See cl 9.2.
See cl 9.4.
See cl 9.3.
See sub-ell 9.2 and 9.4.
See cl 9.4.
See cl 9.3.
3 I See cl 9.3.
32 See cl 9.3.
33 See cl 9.1(3)
Generally
70
71
contract where the construction works are being carried out and during
the defects Liability period, the parties may agree to fonns of remedy
other than damages. Thus, the parties may agree that the contractor Ca.IT)
out rectification works at no cost to the employer.
.
control of materials and workmanship used m the Works.- lt ts an
elaboration of the Contractor's3 obligation set out in Clause 4.1 where it
is provided that the Contractor is to supply all superintendence, la~our,
Plant,~ Construction Equipment,5 materials, goods and all other thmgs.
whether of a temporary or permanent nature required in and for such
design, execution, completion of the Works and remedying of any
Defect.6
The first sub-clause, JO. I, is concerned about quality control in respect
of Plant, materials, goods and workmanship. There are two limbs. The
first limb, Clause I0.1 (a), provides that all Plant, materials, goods and
workmanship must be of the respective kinds described in the Contract.
7
In addition, they must be in accordance with the instructions of th~ S0.
The second limb, Clause 10.1 (b), provides that the SO may, from time to
time, require that all Plants, material, goods and workmanship be
subjected to the necessary tests. l_'he testing may be at _the place of
manufacture, fabrication or preparation. ft may also be on Sile or at other
places as may be specified in the Contract. 8 This sub-claus~ may ~e read
with Clause 11.4 which provides access for the SO to examine or inspect
the Works at all reasonable times including having access to factories,
workshops or other places where any Plant, materials, goods or work are
being fabricated, prepared or stored for the Contract.
The next three sub-clauses regulate the said tests. The second subclause, I0.2, prescribes that the Contractor shal~ provide ever~~ing
necessary, including the samples, as are required for exar:rimm,
measuring and testing any Plant, materials, goods ?r. workman~h1p: It 1s
the SO who selects samples of materials before their mcorporat1on m the
Works that are supplied by the Contractor.
The third sub-clause, 10.3, is very short and provides that the said
samples are supplied by the Contractor at its own cost.
The cost of the test itself is provided in the fourth sub-clause, 10.4. It
provides for two situations. fn the first situation, the Contractor must bear
'I
2
3
4
S
6
7
8
9
10
73
Co ntractor
Contractor's obligations and liabilities
The Contractor is obliged to provide Plant, materials. goods and
workmanship that are of the respective kinds described in the Contract
and in accordance with the instructions of the SO.
In addition. the Contractor's responsibilities relating to the
ascertainment of the quality required before the completion of any part or
parts of the work are:
(I )
(2)
11 See cl 10.l(b).
12 See cl 10.2.
75
(c)
The Contractor must nevertheless carry out the SO's instructions even
though he may dispute the same. If it is decided that the subject matter
under dispute is a defect, then the Contractor is liable for all the related
costs incurred.
The Contractor may also face the liability of termination related to
Clause 31. l (I)(d) which provides for the issue of a Termination
Certificate by the SO in the situation where in the opinion of the SO, the
Contractor has persistently failed to remove Plant, materials, goods or
work from the Site or to pull down and replace work following the expiry
of 14 days from receipt by the Contractor of a written notice by the SO to
the effect that the Plant, materials, goods or work have been condemned
and rejected by the SO.
Contractor's rights and remedies
There are three areas of concern for the Contractor, namely, the tests to be
carried out, the requirement to uncover the covered works and defects.
First, when the Contractor is required to supply a sample for testing, he
must do so al his own cost unless otherwise provided in the Contract. 13 In
addition, the cost of making any test required by the SO is to be borne by
the Contractor in the following circumstances:
(a)
(b)
(c)
13
14
15
(a)
(b)
(c)
(c)
76
In any other case, all such costs and any Loss and Expense must be borne
by the Contractor. In addition. the Contractor is not entitled to any
extension of time for any delay caused by such instruction. 19
Third, where the Contractor responds to the SO's instructions to deal
with any Defect as set out in his instruction pursuant to Clause 10.7, the
Contractor is entitled to his claim of extension of time and Loss and
Ex~ense if pu rsuant to Clause 34 (Settlement of Dispu tes), the SO or an
~b~trator deci_de~ that th~ SO was not justified either wholly or in part in
g1vmg the said mstruct1on and the Contractor had complied wi th the
requirements of Clauses 14, 23 and 32. 20
16
17
18
19
20
See cl I0.3.
See cl 10.4.
See cl 10.4.
See cl 10.S(a).
See cl 10.S(b).
See cl 10.6.
See cl 10.6.
See c.I 10.7.
77
Employer
Employer's obligations and liabilities
By Clause 10.4. it is the Employer who is liable to bear the cost of the
testing if requested by the SO and the result shows that the works have
been carried out in accordance with the Contract. Funher, the Employer
may be liable in respect of any extension of time granted and
consequential Loss and Expense claimed by the Contractor.
In addition, by Clause 10.6, the Employer is similarly liable to bear the
cost of uncovering the Works and any related cost including any Loss and
Expense claimed by the Contractor.
Finally, the Employer may also be liable under Clause l0.7 where the
SO is wrong in identifying any Defect and exercising his powers given by
the said clause.
Employer's rights and remedies
Where the Contractor fails or refuses to comply with the SO's instruction
pursuant to Clause 10.7 (Defects during the Progress of the Works), the
Employer is entitled to employ and pay others to carry out the subjectmauer of the instruction. In addition, the Employer is entitled to recover
from the Contractor, any loss. expense, costs or damages suffered or
incurred by the Employer as a result of the Contractor's non-compliance.
This does not prejudice the Employer's other rights and remedies, if
any.21
The Employer may also have the right to terminate the employment of
the Contractor if the SO issues a Termination Certificate pursuant to
Clause 31.1 ( 1)(d) which provides for the issue of by the SO where in the
opinion of the SO, the Contractor has persistently failed to remove Plant,
materials, goods or work from the Site or to pull down and replace work
following the expiry of 14 days from receipt by the Contractor of a
written notice by the SO to the effect that the Plant, materials, goods or
work have been condemned and rejected by the SO.
Superintending Officer
Role of the SO (and the SO's Rep 22 )
There are four aspects of the SO's role in this clause, namely: (1) he may
prescribe the quality of any Plant, materials, goods and workmanship;
(2) he may conduct tests as prescribed; (3) he may examine and measure
the works before covering up and order the uncovering of the works if
necessary; and (4) he may deal with defects as prescribed. First, the SO is
21 See cl 10.8.
22 See cl I0.5.
78
79
must advise the Contractor in writing accordingly, giving his approval for
the covering up or putting out of view of any Works by the Contractor. 28
In the second situation where the Contractor fails and/or neglects to
comply with the provisions of this clause, the SO may decide to require
the Contractor to uncover any part or parts of the Works or to do all such
things as are necessary for the SO or the SO's Rep to inspect the Works as
constructed. Subsequent to the inspection by the SO or SO's Rep, the SO
may decide to direct the Contractor to carry out any appropriate measure
or requirement pursuant to the clause. 29
Alternatively, the SO may decide from time to time to instruct the
Contractor in writing to uncover any part or parts of the Works or make
openings in or through the same and reinstate and make good such part or
parts. The SO must decide whether part or parts are reinstated and made
good to his satisfaction. The SO must ascertain whether the Contractor
has complied with the requirements of Clause 10.5. If the Contractor did
comply, then the SO must process the Contractor's claims for
compensation for carrying the works, as instructed by the SO, any
extension of Lime and Loss and Expense entitlement due to the Contractor
by ascertaining whether the Contractor complied with the Clauses 14, 23
and 32. Jn any other cases, the SO must ensure that the Contractor bears
the costs of carrying out the works as instructed by him, and any Loss and
Expense incurred. Further, the SO must not entertain any claim for
extension of time.30
Fourth, the SO must ensure that any Defect found in the Works be
appropriately dealt with. Therefore. the SO must form an opinion as to
whether any works, materials, goods and Plant are in accordance with the
Contract or not. If any one of the same is not in accordance with the
Contract, the SO may issue a written instruction to the Contractor
pursuant to Clause 10.7 (Defects during the Progress of the Works).
Where the Defect is found in the work that is completed, the SO may
decide to instruct the Contractor in writing to demolish and reconstruct
any work so that it is in accordance with the Contract.JI Where the Defect
is found in any materials or goods, the SO may decide to instruct the
Comractor in writing to remove from or not to bring to the Site, such
materials or goods and to replace the same with materials or goods which
are in accordance with the Contract.J2 Finally, where the Defect is found
in any Plant, the SO may decide to instruct the Contractor in writing to
remove from the Site such Plant and Lo provide a Plant which is in
accordance with the Contract by the provision of new or alternative or
repaired Plant. 3J In his instruction, the SO may specify the time or times
within which the Contractor is to comply with his instruction. 34
Should there be a dispute between the Contractor and the SO about
whether the SO is justified in giving his instructions involving defects,
the SO must give his decision pursuant to C lause 34 (Settlement of
Disputes). If the SO finds in favour of the Contractor, he must certify any
Loss and Expense and grant any extension of time that is due to the
Contractor. The SO must similarly certify any Loss and Expense and
grant any extension of Lime that is due if an arbitrator finds in favour of
the Contractor as prescribed.JS
28
29
30
31
32
See cl
See cl
See cl
See cl
See cl
10.5.
I0.5(a).
10.6.
10.7(a).
I0.7(b).
80
Arbitrator
Role of the arbitrator
Reference is made to the role of the arbitrator under Clause 34 where he
must resolve the dispute between the Contractor and the SO in respect of
the SO's instruction issued under Clause 10.7. The arbitrator has to
decide whether the SO is justified, either wholly or in part, when the SO
gave the said instruction to the Contractor. J6
Cross References
The clauses expressly referred to in this clause are Clauses 10.5
(Examination and Measurement of Works before Covering Up),J7 10.7
(Defeccs during the Progress of Works),38 14 (Time for CompJetion), 39 19
(Variations to the Works), 40 20 (Val uation of Variations), 41 23 (Procedure
33
34
35
36
37
38
39
40
4I
See cl l0.7(c).
See cl 10.7.
See cl 10.7.
See cl 10.7.
See cl 10.6.
See cl I 0.8.
See sub-ell 10.4, 10.6 and 10.7.
See cl 10.4.
See cl 10.4.
81
Clause 11 - Administration
Generally
In every building and construction site, the Contractor usually has
complete control over the site and becomes the legal occupier when
possession of the site is given to the Conlractor. IL would be difficult for
the Superintending Officer (SO) to carry out admi nistration of the
contract without being given access to the site to check the completed
works as well as access to other places off site lo be in a position to check
how components of the building or structure are being manufactured.
In the same way, while the responsibility and liability is allocated to
the Contractor in respect of site operations and method of working, the
SO must be put in a position to be able to regulate the days and hours of
working. Similarly, although the Contractor is responsible and liable for
the provision of superintendence of the works and the supply of labour,
the SO should be given a say as to whether a workman or other personnel
should be removed.
Finally, as it may not be easy to contact the Contractor and require his
presence on site immediately, it is good practice to require a Contractor's
representative to be present on site constantly to supervise the works on
site as well as to receive instructions from the SO.
Intention of the Clause
42
43
44
This clause has four sub-clauses. The first sub-clau~e. 11.1, regulates the
working hours and days and does not allow work at night, Sundays and
public holidays without the SO's written permission. This sub-clause has
to be read with Clause 15.2 which permits work at night, Sundays and
public holidays. This sub-clause therefore gives an elaboration to the
extent of the Contractor's obligation under sub-clauses 4.1 and 4.2.
The second sub-clause, 11.2 has two limbs. Clause 11.2( 1) provides
for the appointment of the Contractor's Representative (defined
accordingly under Clause 1. I (g)). It is to be noted that any instruction
given to the Conlractor's Representative shall be deemed to have been
given to the Contractor. This sub-clause has to be read with
Clause 36.2(3) where all instructions to be given to the Contractor shall
83
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Public Sector Standard Condi1ions of Contract for Co11stmction Works 2005
Clause I I -Admi11istra1io11
Contractor
84
Role of the SO
Under Clause 11.1. if work is required during the night or on Sundays
and public holidays, the SO needs to give written permission before such
work can be carried out. He is empowered to give written permission only
when such work is rendered unavoidable or necessary for the saving of
life or property or for the safety of the Works.
The SO is empowered by Clause 11 .2(2) to object to the appointment,
employment or continued employment of any person appointed or
5
6
7
See cl 11 .2(2).
See cl 11.3.
See cl 11.4.
85
Generally
Cross References
There is no express reference to any clause. The days and hours of work
are mentioned in Clause 15.2. The giving of the SO's instructions to the
Contractor is also mentioned in Clause 36.2(3). Re lated to Clause 11.3
are sub-clauses 4. 1 and 4.3 which provide for the supply of labour.
Related to Clause l l .4 is Clause I0 which provides for quality of Plants
and materials.
The contractor must be on site before he can carry out the work as agreed.
As the employer wants the work done. he must give or arrange to give the
necessary possession of the site to the contractor. As a contract period to
carry out and complete the works is usually agreed by the parties, the
employer must ensure that the possession of site is not only given to the
contractor but it must also be given so that the contractor can carry out
and complete the work in the time frame agreed. In Teknikal dan
Kejuruteraan Pte Ltd v Resources Development Corp (Pte) Ltd. 1 the
Court of Appeal held that:
[tjhere is a general obligation on the part of the employer not to prevent the
performance of the contract by the contractor. The obligation to give
possession of the site at the time provided by the contract is part of this
general obligation. Conversely, the contractor ha~ the right to carry out his
work in the order he chooses. A failure to give possession of the site in
accordance with the contract may amount to an interference with this right.
During the contract, the employer usually reserves a right to deploy other
contractors engaged by him on the site. This is Lo e nsure that if the need
arises to use other contractors to carry out work other than the scope of
works agreed between the employer and the contractor, then the two
parties do not need to enter into any further agreement.
At the end of the contract period or earlier in the case of a premature
tenn ination, the contractor must return possession of the site to the
employer. The return of this possession of site to the employer is more
critical when there is a premature termination of the contrac t since the
employer has to arrange for the completion of the balance of the work left
undone by the original contractor at the time of tennination. The
employer would be prevented from doing so if the contractor is allowed
[ 1994 ( 3 SLR 743 at 756.
86
87
I was firml) of the view that the second injunction ought to be discharged,
and I accordingly made the order. The joint venture had been terminated and
the plaintiff should not be permitted to remain in possession of the site and the
defendant should be at liberty to engage other contractors to continue with the
construction of the houses. If an injunction were to continue it would bring
about a stalemate: the defendant refused to pay the plaintiff on the ground of
breach of contract by the plaintiff and the termination of the joint-venture
agreement was justified; the plaintiff on the other hand, refused to proceed
with the construct.ion of the houses o n the ground that it had not been paid and
the termination was wrongful. Such a position is untenable. Even if the
termination was wrongful, the plaintiff would still have to vacate the s ite and
deliver possession thereof to the defendant. The plaintiff may proceed with its
claim against the defendant for damages.
This clause has five sub-clauses. The provisions in this clause relate to the
Site, namely: (1) giving the Contractor3 possession of the Site in order
that works may commence; (2) the consequences of failure to give
possession of Site to the Contractor; (3) the Contractor's obligation to
obtain access to the Site; and (4) the sharing of the Site by the Contractor
with other comractors.
According to Clause l. l (z), 'Site' means the lands and other places on,
in, under, over or through which the Works are to be executed or carried
out or any other lands or places provided by the Employer for the
purposes of the Contract4 and by Clause I. I (ag), ' Works' means the
Temporary Works 5 and the Permanent Works, 6 and where the context
requires, a phase or part of the Works.
The first sub-clause, 12.1 , defines three things. First, it defines the
commencement of Works as being on (a) the Date specified in the Letter
of Acceptance7 and, failing which, (b) on the date specified in an
instruction by the Superintending Officer (S0). 8 Second, this date of
commencement is also the date that sets the Time for Completion 9
running. Third, the rate of progress of works is defined and pegged to the
programme for the works required under Clause 9 as that the Contractor
shall proceed with due diligence and expedition and without delay in
2
3
4
5
6
7
8
9
[1991]2MU229at 231.
Contractor
89
from the S0. 13 The Contractor faces the liability of termination under
Clause 31.1( 1)(b) if he fails to commence without cause.
After commencing his Works. the Contractor is required to proceed
with due diligence and expedition and without delay in accordance with
the Contract and programme or any revised or modified programme
accepted by the SO. The Contractor faces the liability of having to
expedite the progress of works under Clause 15 if in the opinion of the
SO the rate of progress of works is too slow to achieve completion by the
Time for Completion.
Accordingly, the Contractor is obliged to complete the Works within
the Time for Completion with the date on which the Contractor is to
commence the Works as the date of commencement of this period of the
Time for Completion. 14 The Contractor faces the liability of having
liquidated damages imposed on him under Clause 16 if he fails to
complete on the latest extended date for completion.
The Contractor must at his own expense be responsible for obtaining
any rights of way or access including the rights of over-sailing that may
be required by him or his methods of operation for the purpose of the
execution and completion of the Works. In addition, the Contractor must
also provide at his own cost and expense any additional accommodation
or land outside the Site as required by him for the purpose of the Works. 15
The Contractor faces the liability of successful trespass suits by
neighbouring land owners if the Contractor intrudes into the land of the
neighbours without fust obtaining the necessary rights.
Although the possession of the Site is given to the Contractor, he is
obliged to permit the execution of any work by any person who has been
employed or otherwise engaged by the Employer to carry out on-Site
work which does not form part of the Works. 16 Further, if any part of the
Works depends for the proper execution or results upon the work of any
such person employed or e ngaged by the Employer. the Contractor must
inspect and promptly report in writing to the SO any apparent
discrepancies or defects in such work that may materially affect and
adversely affect the execution of the Works. It is deemed that the
Contractor has accepted such a person's work as fit and proper to receive
into the Works if the Contractor fails to give the SO the said report. 17
In addition, the Contractor is exposed to the liability of an occupier
under the occupier's liability principle as, by virtue of his possession of
the then Site, he is the occupier of the Site.
13
14
15
16
17
See cl
See cl
See cl
See cl
See cl
12. l(b).
12.1.
12.4.
12.5( I).
12.5(2).
Employer
18
19
20
90
olherwise engage any persons to carry out, on Site, work which does not
form any part of the Works, whether or not infom1ation wilh respect to
such work is provided in the Contract.
Superintending Officer
Role of the SO
See cl
See cl
Seecl
See cl
See cl
See cl
12.5( I).
12.l(a). See also cl 31.l(l)(b).
12.l(b).
12.l.Seealsocll 14.2and31.l(l)(c).
12.3.
12.5(2).
92
See cl 12.1.
28 See cl 12.2.
See cl
Sec cl
See cl
See cl
33 See cl
29
30
31
32
12.3.
12.2.
12.3.
12.3.
12.3.
93
Clause 13 - Suspension
Generally
There may be instances when work on a construction project may have to
be suspended for various reasons. This could be due to clients being
unable to make certain decisions and thereby likely to hold up progress of
the works or due to the late entry of end tenants and users to the project
whereby portions of the work may have to be held up pending decision.
As long as the contractor is appropriately compensated by way of
extension of time and/or loss and expense, there is nothing implicitly
wrong with such suspension. What may be inappropriate would be the
suspension for an unduly long period of time to the extent that the
resumption or continuity of that portion of the work becomes
questionable.
I
2
3
For deft muon of Superintending Officer. see cl I. !(ab). See also cl I 3.1.
For definuion of Works. see cl l.l (ag).
For definition of Contractor, see cl 1.1 (J).
95
96
Clause 13 - Suspension
Employer
Employer's obligations and liabilities
By virtue of Clause 13. I (2), the Employer would be liable for the amount
of Loss and Expense certified by the SO and would be exposed to any
liability arising from the grant of any extension of time under the clause.
Superintending Officer
Role of the SO
The SO is the deciding authority for suspension. Instructions for
suspension of the progress of the Works are to be in writing and can be
for any phase or part of the Works, and for such time or times and in such
manner as the SO considers necessary. 9
Other than instructing the suspension in writing, the SO is empowered,
in relation to lhe suspension, to: (1) certify any Loss and Expense
incurred by lhe Contractor; and (2) grant an extension of time.
Such Loss and Expense and extension of time must however not be:
(a) otherwise provided for in the Contract; (b) necessary due to some
default of the Contractor; or (c) necessary for the proper execution of the
Works or for its safety. 10
When served a notice by the Contractor requiring permission to
proceed wilh the suspended Works, Lhc SO has 30 days to respond with
the grant of permission.
Cross References
The clauses expressly referred to in lhis Clause are: 23 (Procedure for
Claims), 32 (Progress Payments and Final Account), 14 (Time for
Completion), 11 19.1 (Variations) and 31.4 (TerminaLion Without
Default). 12 Clause 13.1(2) is menLioned in Clause 14.2(k), while
suspension is mentioned in Clause 22. l (d).
97
Generally
Some contracts may have one date for performance, eg a delivery date of
goods. Other contracts may have a period identified for performance.
Thus, in a design and build contract. there may be a period for
performance that is divided into three parts, eg the time for design of, the
time for construction and completion of and the time for maintenance of
the Works. In building and construction contracts, only two parts are
performed by the contractor while the design part is carried out by the
employer's designers.
Most development projects are planned so that the commencement of
the use of the completed structure is known in order to project the
generation of income. Hence, fixing a time for completion is usually
expected. However, where no time or date for completion is specified in a
contract, completion within a reasonable time will be implied. The other
situation where the contractor is required to complete within a reasonable
time is when the original time fixed for completion becomes inapplicable.
According to volume 2 of Hudson 's Building and Engineering
Contracts: 1
Where a contract is for defined work. so that there will be an express or
implied obligation to complete, completion within a reasonable time will be
implied if no time or date is specified in the contract. The same result occurs
where a contractual completion date has been specified, but has ceased to be
applicable. This can happen where there has been agreement to that effect;
where there has been a waiver of an earlier breach of the completion
obligation, or an election by the owner to leave the contract on foot which
might otherwise have been cancelled for this reason; or where the owner has
in one way or another prevented completion within the contract time without
any breach on his part (as for instance. by ordering extra work); or by failing
lo give possession or by some other breach of comracl.
It has been found that some building and construction contracts do
contain provisions that make time for completion the essence. This means
Ian Duncan Wallace QC. Hudson's Building and Engineering Co111racrs ( 11th ed,
1995. Sweet & Maxwell) p 1110. para 9-007.
99
that the parties have agreed that the term is important and the
consequence of its breach by the contractor would entitle the employer to
terminate the contract. However the existence of extension of time and
Liquidated damages provisions is generally regarded as incompatible with
the requirement that time should be of the essence. Accordingly, it is
observed as such by the editor of Hudson's as set out below.
When. finally. it is remembered that the builder's work on the owners land
cannot be refused or returned (as in the case of chattels) 11 is not surprising
that it is only in the most unusual case that the courts will hold time for
completion to be of the essence in a genuine building contract [the case of
Lucas v Godwin (1837) 3 Bing NC 744 was referred to]. Further. the
existence of provision for extension of time or for payment of liquidated
damages will generally be regarded (on the looking at the whole agreement
principle) as incompatible with an intention that time should be of the essence
[the case of Lamprell v Billericay Union ( 1849) 3 Exch 283].2
However, it has been characteristic of poor draftsmanship of recent years.
in nearly all commercial fields, that 'of the essence wording is frequently
used to 'overegg the pudding' in relation to obviously inappropriate
contractual obligations, and should not be accorded the same weight as when
used in a more considered way in more 'appropriate settings', it is submitted.~
The time fixed for completion assumes that the contractor would not be
prevented from doing so: by the employer, by himself or those under his
responsibility or by something beyond the control of both parties. Thus, if
the contractor is delayed, he would fail to complete the Works on the
original date of completion based on the lime fixed for completion. The
additional time needed for completion by the contractor may be divided
into two parts. The first part is the time in which the contractor is entitled
to an extension of time for completion. The second part is known as the
delay period in which the contractor is liable for the delay in completion.
Therefore, although the time for completion is fixed, it is possible to
have such time extended based on the prescribed grounds. Such
extensions of time, while appearing to benefit the contractor are in reality
part of a mechanism to keep the liquidated damages provisions alive.
Thus, if extension of time is not provided for any delay caused by the
employer, his agents or servants, or any person for whom he is
responsible. then time becomes at large, thereby rendering the liquidated
damages provisions inoperable.4 This is summarised by the editor of
Hudson's below:
It is submitted . . . (a) that the acts of prevemion by the owner. whether
authorised by or breaches of contract, will set time al large and invalidate any
2
3
4
100
'
The first sub-clause, 14.1. refers the party to: (a) the Letter of
Acceptance; or (b) the Appendix, as the case may be for the Time or
Times for Completion. By Clause 3.1, it appears that should there be an
inconsistency between what is found in the Letter of Acceptance and the
Appendix, they are to be taken as mutually explanatory of one another.
The second sub-clause, 14.2, sets out the circumstances in which
extension of time would be given. There are four general prescriptions
5
6
7
8
9
10
11
101
and 17 specific prescriptions from items (a) to (q) inclusive. The four
general prescriptions include:
(a)
12
102
Contractor
Contractor's obligations and liabilities
The Contractor's basic obligation to execute and complete the Works
(first spelt out under Clause 4.1) envisages not just completion but
completion on time, that is, within the Time for Completion that is stated
in either the Letter of Acceptance 1J or the Appendix. 14 Where phases are
involved, completion of these phases or parts is in turn required within
their respective Times for Completion stated in the same.
The Contractor is expected, with due diligence, to take all reasonable
steps to avoid or reduce any delay in completion which will be, may be or
has been caused by any of the events spelt out in Clause 14.2(a) to (q).
The starting point of the Extension of Time (EQT) procedure is the
Contractor's notice in writing to the SO that, in his opinion, an event,
subject to those listed in Clause 14.2, will delay or has delayed the
13
14
See cl 14.l(a).
See cl 14. l(b).
103
It should be noted that both the notice and further information are
Employer
Employer's obligations and liabilities
Although it is not expressly stated in this clause, the Employer19 is
exposed to the possible liability to pay the amount claimed by the
Contractor as Loss and Expense20 under Clause 22 should an extension of
time be given.
15 See cl 14.3( I).
16 See cl 14.3( 1).
17 See cl 14.3(2).
18 See cl 14.3(5).
19 For definition of Employer, see cl I. I (m).
20 For definition of Loss and Expense. see cl I . I (q).
104
force majeure;
exceptionally adverse weather conditions:
industrial action, strikes, lock-outs etc in Singapore;
one or more of the 'excepted risks' under Clause 25.2;
compliance with requirements of law, regulation, etc;
(f) fire, storm, lightning, etc:
(g) Ordering of test by SO not pursuant to Clause 10.4;
(h) the issue of any instruction for a variation:
(i) SO's instructions in relation to Provisional Sums;
U) failure of Employer lo give possession of Site or any part as
required by Clause 12.2;
(k) SO's instruction to suspend work subject to Clause 13.1 (2);
(I) late receipt of drawings, instructions or other information from the
SO for which notice is given by the Contractor in accordance with
Clause 3.4;
(m) acts or omissions of other contractors engaged by the Employer in
executing work not forming part of the Contract;
(n) any act of prevention or breach of contract by the Employer not
mentioned in this Clause;
(o) SO's instruction for search under Clause 18.4 where such search
reveals any defect, shrinkage or other fault for which the Contractor
is not liable;
(p) adverse physical conditions falling within Clause 5.2; and
(q) any other ground for extension of rime expressly mentioned in the
Contract and not mentioned in this Clause 14.2. 21
2 1 See cl I 4.2(a)-{q).
105
Arbitrator
Role of the Arbitrator
There are two roles set out in C lause 14.3(5). First, it is expressly
provided that the arbitrator (or any other tribunal) in considering the
dispute shall not take into account information which was not available to
the SO at the time when the SO made his original decision to make or not
to make an extension of time. Second. it is implied that the arbitrator shall
not entertain a claim for a greater extension o f time than that notified
pursuant to Clause 14.3( 1) nor advance new or additional grounds not
submitted to the SO before he made his decision.
Cross References
22
23
24
25
26
27
See cl
See cl
See cl
See cl
See ct
See cl
28
29
30
31
32
33
34
35
36
37
14.2.
14.3( I).
14.3(2).
14.3(3).
14.3(4).
14.3(5).
106
See ct 14 2(d).
See ct 14.2(e).
See ct 14.2(g).
See cl 14.2(.i).
See ct 14.2(k).
See cl 14.2(1).
See cl 14 2(o).
See cl 14.2(p).
See cl 14.3( 1).
See cl 14.3(5).
!07
Generally
Building and construction contracts usually provide for the Contract
Period which spans from the commencement to the completion of the
Works. What may appear to be inconsistent would be the clause that
prescribes a rate of progress of works. eg due diligence and expedition, as
compared with the clause that leaves the planning of the site operations
and methods of working entirely to the Contractor. This is further
aggravated by another usual provision requiring the submission and
approval of a programme for the works which is declared to be nonbinding nevertheless.
It would appear that for it to be possible LO expedite the progress of the
works, there must be a mechanism to ascertain the existing progress as
well as to be able to so determine that it is slow or not fast enough to
ensure completion on time. It would also appear to interfere with the
Contractor's right to determine his site operations, methods of working
and programme for the works.
Intention of the Clause
This clause has two sub-clauses. It provides a mechanism to regulate the
rate of progress of the Works. 1 hence this clause must be read with
Clause 12.1 (Commencement of Works), which prescribed the rate of
progress of works, ' the Contractor2 shall proceed with due diligence and
expedition and without delay in accordance with the Contract3 and in
accordance with the programme or any re\ised or modified programme
accepted by the SQ-I pursuant to Clause 9'.
The first sub-clause, 15.1. empowers the Superintending Officer (SO)
to notify the Contractor in the event he is of the opinion that the
Contractor's progress is too slow to achieve timely completion, and
I
2
3
4
109
prescribes that the Contractor shall. on such notice, take steps to expedite
his progress in order to complete the Works. 5 One of the steps includes, if
required by the SO, the preparation of a revised or modified programme
for acceptance pursuant to Clause 9. The last point in this sub-clause is
the provision for the SO to decide whether the Contractor deserves
additional payment by treating the event as a variation.
The second sub-clause provides for the situation where the Contractor
considers it necessary to work at night or on Sundays or public holidays.
Thi s provision should be read with Clause 11 .1 (Days and Hours of
Working). The Contractor may seek the SO's consent which should not
be unreasonably withheld.
Contractor
Contractor's obligations and liabilities
When notified by the SO in writing, the Contractor is required to take the
necessary steps to expedite progress and complete the Works or the
relevant phase or part. If required by the SO, such steps should include
the preparation of a revised or modified programme for the SO's
acceptance pursuant to Clause 9 (Programme for the Works).6 The
Contractor is also obliged to work at night, Sundays and public holidays
if necessary but he must obtain the SO's consent to do so.
If the SO does not consider that the Contractor deserves additional
payment as allowed by Clause 15. l, then the Contractor's liability is to
bear the cost of expediting the progress of works.
Employer9
Employer's obligations and liabilities
Although it is not expressly stated, if the SO issues an instruction for
variation under Clause 15. 1, it can be inferred that the Employer is liable
to pay for the cost of expediti ng the progress of the works.
Superintending Officer
Role of the SO
The SO's duties in relation to this Clause are four-fold. First, he is
expected to assess whether, in his opinion. the rate of progress of the
Works is too slow to achieve on time completion. Second, if this is so, he
is to notify the Contractor in writing accordingly. Third, he can require
steps taken by the Contractor to include the preparation of a revised or
modified programme for his acceptance under Clause 9. Fourth, if the
Contractor seeks the SO's consent to work at night and on Sundays or
public holidays, the SO shall not unreasonably withhold such consent.
The SO is empowered to issue an instruction for variation in respect of
the steps required to expedite the progress of the Works.
Cross References
The clauses expressly referred to in this clause are Clauses 9 (Progranune
for the Works) and 19.l(f) (Variations). The rate of progress of works
may be found in Clause 12. I ; while the regulation of working at night, on
Sundays and on public holidays is also mentioned in Clause 11 . 1.
6
7
8
Seecl 15. 1
See sub-ell 9.2 (Revision of Programme) and 9.3 (Acceptance of Programme).
For definition of Time for Completion, see cl 1.1 (af).
Sec cl 15.2.
110
Ill
Generally
113
not require him to prove actual loss suffered as a result of the delayed
completion.
In the absence of a liquidated damages provision, the Employer's
recourse is lo claim damages, that is, monetary compensation. from the
Contractor where proof of loss is required. Thus, in Kassim Syed Ali &
Ors v Grace Development Pte Ltd & Anor,2 the Court of Appeal held that:
- --
The burden is on Lhe appellants to show the loss they had suffered [as a result
of the breach of contract]. Here. the appellants had not given evidence: nor
had they adduced any evidence as to the extent of the loss. In the absence of
such evidence, il is hard lo come to any conclusion other than that the
appellants have not suffered any loss. Damages are compensatory, and one
cannot seek compensation in vacuo. Compensation must be measured against
the loss suffered.
Following this, a few cases from other jurisdictions will be looked at to
throw some light on common provisions found in standard forms of
building or construction contracts.
Usually the provision of liquidated damages in a standard form of
contract wou ld require the parties to fill the blank given to indicate the
rate of liquidated damages to be imposed. The courts from England and
New South Wales were asked to interpret the significance of inserting
'Nil' in the blank space where the liquidated damages rate was to be
filled. According to Nourse Ll, at page 39 sitting in the English Court of
Appeal, in Temloc Ltd v Erill Properties Ltd (1987) 39 BLR 30, the
liquidated damages provision 'constitutes an exhaustive agreement as to
damages which are, or are not payable by the contractor in the event of
his failure to complete the works on time'. He then concluded at page 40
that: ' I find it impossible to attribute to parties who complete the
appendix in one way or the other an intention that the employer shall have
the option of claiming damages of precisely the same character but in an
unliquidated amount'.
This may be contrasted with the decision of Giles J sitting in the
Supreme Court of New South Wales in Baese Pty Ltd 1 RA Bracken
Building Pry Ltd (1989) 52 BLR 130. The learned judge held at
pages 138 and 139 that: in my view, on the construction of this contract.
clause 10. 14 was not an exhaustive statement of the proprietor's
entitlement in the event of failure to bring works to practical completion
by the date for practical completion'. 'It seems to me that the function of
clause I0.14 was to enable the proprietor, if he so desired, to cause the
architect as his agent to invoke the machinery whereby liquidated
damages could be assessed, or enable the architect to do so, but that if the
proprietor or the architect did not do so, then the proprietor was entitled
to rely upon his common law right to damages for breach of
clause 1.02.03."
2
This clause has four sub-clauses. This clause primarily regulates the
imposition of liquidated damages. Where the contract is terminated, this
clause must be read with Clause 31.3 (Liquidated Damages after
Termination) which provides for liquidated damages after termination.
The first sub-clause. 16. l. has two limbs. The first limb provides for
the situation where there are no phases or parts in the Works. H also
provides for the payment of liquidated damages by the Contractor3 to the
Employer and, correspondingly, a right of recovery by the Employer.
This clause must be read with Clause 35. the provision for recovery by
the Employer. It provides the Employer with a contractual remedy when
3
4
115
Contractor
6
7
8
116
12
13
14
15
16
17
18
19
See cl 17.1.
See cl 16.2.
See cl 14.
Seecl 16.1( 1).
See cl 16.1(2).
Seecl 16.4.
Seecl16.3.
For definition of Loss and Expense, see cl I. I (q ).
117
Employer
Further, the SO must decide whether to grant an extension of time and the
length of the same for delays as set out in sub-clauses 14.2(g) to (q)
'Extension of the Time for Completion' which are caused after the Time
for Completion has expired and the Contractor has not completed the
works. all in accordance with the requirements imposed on the Contractor
under Clause 14 (Time for Completion).:!5
Cross References
The clauses expressly referred to in this clause are Clauses 14 (Time for
Completion),26 14.2(g) to (q) <Extension of the Time for Completion)27
and 16 (Liquidated Damages)28 and the Appendix. Liquidated damages is
mention in Clause 31.3.
Superintending Officer
Role of the SO
Clause 16 does not prescribe any role for the SO. However, there are
references to the SO's role prescribed by other clauses. Accordingly,
under Clause 17 (Substantial Completion), the SO must decide whether
and when to issue the Certificate of Substantial Completion in respect of
any part of the Works even before the Time for Completion has expired. 24
20
21
22
23
24
See cl
See cl
See cl
See c l
See cl
16.1
16.2.
16.4.
16.3.
16.2.
25 See cl 16.4.
26 See sub-ell 16. l and 16.4.
27 See cl 16.4.
28 See cl 16.1.
118
119
Generally
to him under Clause 17. l(a) and 17.l(b) at his own discretion.9 The
process of achieving such certified completion further takes into account
the instance where work is not so completed. and allows for instruction to
carry o ut and complete the same. 10
The Defects Liability Period is calculated from the date on which
substantial completion is achieved. From this same date, the Contractor's
licence to remain on site also comes to an end, and any further need to reenter is restricted to the carrying out of outstanding work and defects
rectification. 11
This clause has three sub-clau ses. As the D ate of Substantial Completion 1
marks both the end of the delay period in which the Contractor2 is liable
to pay the Employer3 liquidated damages and the beginning of the
Defects Liability Period,4 this clause must be read with Clauses 16
(Liquidated Damages) and 18 (Defects). As the date also marks the end
of the licence to occupy the Site5 under Clause 17.2, this clause must also
be read with Clause 12 (Possession of Site and Commencement of
Works). As Clause 17 .1(I) provides for the Contractor to undertake to
complete outstanding work during the Defects Liability Period, it must be
read with Clause 18 .1(a).
By Clause 1.1(i), the Date of Substantial Completion means the date
stated in a certificate issued pursuant to Clause 17. l or 17.3. What is
stated in this certificate is prescribed in Clause 17.l ( l)(a) which provides
for the Superintending Officer (S0) 6 to issue a certificate stating the date
on which, in his opinion, the Works were s ubstantially completed in
accordance with the Contract.7 In Clause 17 .3, the SO may issue s uch a
certificate in respect of a phase or part of the Works as prescribed.
lt serves a number of very important purposes:
(I)
(2)
(3)
(4)
2
3
4
5
6
7
8
Contractor
Contractor's obligations and liabilities
The Contractor's twin duties relate to giving notice and an undertaking.
When he considers that the whole of the Works has been substantially
completed, the Contractor may notify the SO in writing to that effect.
This notice musl be accompanied by an undertaking to complete any
outstanding work during the Defects Liability Period. 12
In respect of any phase or part of the Works for which a separate Time
for Completion exists. the Contractor may request the SO to issue a
Certificate of Substantial Completion. 13 This applies similarly for any
substantial part of the Works completed to the SO's satisfaction and
occupied or used by the Employer other than as provided for in the
Contract. 14 In respect also of any part of the Works for which the SO has
issued instruction for early occupation or use by the Employer prior to the
completion of the whole of the Worh. the Contractor may request for the
same issue of a Certificate of Substantial Completion. The prior
occupation or use must not however be one tha1 is provided for in the
Contracl or agreed by the Contractor. 15
Where the SO does not issue the certificate but instead issues an
instruction pursuant to Clause 17.1( I )(b ), then the Contractor is obliged
to comply with his instructions to carry out all the works specified by the
SO in his instruction before the issue of the certificate.
It may be inferred from here that the Contractor's liability to pay
liquidated damages to the Employer is affected by whether the certificate
is issued. Accordingly. if the certificate is issued later, then the
Contractor's liability would be correspondingly increased . The
Contractor's liability to pay more would thus result in an increased
I. I {i).
9
10
11
J2
123
expenditure for each Preliminary item to be spent for each day longer that
the issue of the certificate is delayed.
Cross References
Employer
Role of the SO
On receipt of the Contractor's notice and undertaking, the SO has 21 days
to respond in one of two ways. He may within this period either: ( I) issue
a Certificate of Substantial Completion stating the date on which in his
opinion the Works were substantially completed; 17 or (2) oivc
instructions, in writing, specifying all the works which in his opinionare
16
17
Seecl 17.2.
See cl 17.l(l)(a).
124
125
Clause 18 - Defects
Generally
The common law remedy for the presence of defects is damages whereby
the employer is compensated monetarily for the Contractor's failure to
comply with the contract in carrying out and completing the Works.
Unless it is otherwise provided, the Employer can only hope to recover, in
most instances, the cost of making good the defects. This may not be the
most appropriate way of dealing with defects. First, the Contractor is in a
better position to make good defects as he is already on site. He does not
need to incur a separate mobilisation cost to carry out repair works as
would be required of other contractors. Second, where the making good
of defects requires the use of matching materials, the Contractor is again
in a better position because it is likely that he would have the necessary
stock of building materials to fulfil this requirement. Third, the
Contractor would also be quicker in responding to any request for making
good as compared to other contractors. However, it is also common to
provide for the Employer to engage other contractors to carry out the
repair works if the Contractor fails to respond as prescribed. This is to
ensure that the defects are repaired even if the Contractor, for whatever
reason, fails to carry out the repair works.
In providing contractual remedies. one issue of concern is whether the
common law remedies have been displaced. In HW Nevill (Sunblest) Ltd
v William Press & Son Ltd,1 the court was posed the issue of '[w]hether
the plaintiff's remedies in respect of the alleged defective work are
limited to the remedies specified in clause 15 of the agreement, and
whether accordingly the plaintiff is not entitled to recover damages
therefor '. Judge Newey QC said:
... Clause 15(2) and (3) gave only a right to re-enter to such extent as was
necessary to remedy defects pursuant to a schedule prepared or instructions
given by the arch.itecl. I th.ink that defects in the drain discovered after the
certificate of practical completion had been given undoubtedly constituted
breaches of contract. Clause I 5(2) and (3) provided an efficient way of
dealing with defects to the advantage of both parties. If Nevil had had to seek
contractors new to the site to do remedial work it might well have had
difficulty in finding them. It would also almost certainly have had to pay them
more and would then have sought to have recovered from William Press more
than the cost to William Press of making good the defects. Whether a clause
such as Clause 15 limits a party's remedies to that provided by the clause
depends on the construction of the contract, see Lord Denning MR in
Hancock v Brazier (1966] I WLR at 1317. A clause such as Clause 15,
merely created a simply (sic) way of dealing with part of a situation created
by breaches of contract, is not to be read as depriving the injured party of his
other rights.
This decision was adopted in the Singapore case of Raymond
Construction Pte Ltd v Low Yang Tong & Anor. 2
Intention of t he Clause
This clause has five sub-clauses. This clause concerns not only Defects3
which is also the heading for this clause but also outstanding work at the
Date of Substantial Completion 4 as well as shrinkages and other fault. By
Clause l.1 (j) 'Defect' means:
any part of the Works5 not executed provided or completed in accordance with
the Contract.6 For the avoidance of doubt and without limiting the generality
of the expression the term shall be taken to include any item of Plant.7
material, goods or work incorporated or used in the Works which does not or
may not conform to the relevant quality standards or pass the tests prescribed
in or to be inferred from the Contract.
The fust sub-clause, 18.l has two limbs. The first limb provides for the
Contractor8 to complete with due expedition and without delay the works
which were outstanding9 at the Date or Dates of Substantial
Completion. 10 The second limb provides for the execution of a ll such
works of amendment, reconstruction and remedying defects, shrinkages
or such other fau lts of whatever nature as instructed by the
Superintending Officer (S0). 11
The second sub-clause, 18.2, contractually allocates the burden of
bearing the cost of carrying out the works prescribed in Clause 18.1. The
task of ascertaining whether the Contractor is to bear the cost or not, lies
2
3
4
5
6
7
8
9
I0
11
128
Contractor
Contractor's obligations and liabilities
Generally, there are three main obligations imposed on the Contract~r 13 in
this clause. First, the Contractor must complete any work outstanding at
the Date or Dates of Substantial Completion at or before the expiration of
the Defects Liability Period 14 under the following conditions: (a) with
due expedition; (b) without delay; (c) as may be instructed by the S0; 15
(d) by achieving the condition required of the completed works as
required by the Contract; 16 and (e) by meeting all other requirements of
the Contract. 17
Second, the Contractor must execute all such works of amendment,
reconstruction and remedying defects, shrinkages or such other faults of
whatever nature as the SO may al any time during the Defects Liability
Period or within 14 days after its expiration instruct the Contractor to do
the same bearing in mind that the Works is intended to be in a condition
as required by the Contract and must meet all other requirements of the
Contract at or before the expiration of the Defects Liability Period. 18
These works are to be done at the Contractor's own cost when the SO
is of the opinion the work is necessitated by: (a) a Defect; (b) any fault in
a design which the Contractor is responsible; and {c) the Contractor:s
neglect or failure to comply with any express or implied obligation on his
12
13
14
15
16
17
18
129
Clause 18 - DefeCI.t
Employer
Employer's obligations and liabilities
Although it is not expressly provided, it can be inferred that the Employer
is liable to the Contractor under Clause 18.2 for the cost of the work done
by the Contractor if the need to carry out the works was not because of
the situations set out in Clause l 8.2(a) to (c).
Employer's rights and remedies
When the Contractor completes any work that is outstanding at the Date
or Dates of Substantial Completion as prescribed by Clause 18. l (a) or the
19
20
21
22
23
See cl
See cl
See cl
See cl
See cl
Superintending Officer
Role of the SO
There are two aspects of the role of the SO in this clause, namely,
completion of the outstanding works and making good of defects. First,
the SO is empowered to instruct the Contractor to complete any work that
is outstanding at the Date or Dates of Substantial Completion.27
Second, the SO is empowered to instruct the Contractor at any time
during the Defects Liability Period or within 14 days after its expiration
to execute all works of amendment, reconstruction and remedying
defects, shrinkages or such other faults of whatever nature. 28 Related to
this power, the SO must decide whether the Contractor is to execute the
said works at his own cost or not. The SO must give his opinion as to
whether the work carried out by the Contractor pursuant to
Clause 18.1 (b) was necessitated by: ( l) a Defect; (2) the Contractor's
fault in a design which he is responsible for; or (c) the Contractor's
neglect or failure to comply with his express or implied obligation. 29
If the SO is of the opinion that it is so necessitated, the Contractor must
bear the cost of the said works. [f the SO is of the opinion that it is not so
necessitated, the SO must proceed to value such work in accordance with
Clause 20 (Valuation of Variations) as if it were a variation ordered under
Clause 19 (Variations to the Works) but shall not otherwise be construed
as a variation subject to the com pliance by the Contactor with Clause 23
(Procedure for Claims). 10
24
25
26
27
28
29
30
18.2.
18.5.
18.4.
18.5.
18.2.
130
See cl
See cl
See cl
See cl
See cl
See cl
See cl
18.1.
18.3.
18.5.
18.1 (a).
18.l(b).
18.2.
18.2.
131
Cross References
The clauses expressly referred to in this clause are Clauses 18.1 to 18.4
(Defects),33 18.1 (b) (Completion of Outstanding Works),34 19 (Variations
to the Works), 35 20 (Valuation of Variations)36 and 23 (Procedure for
Claims). 37
Defect is mentioned in Clause 10.7 while defects is mentioned m
Clause 17. I (2)(a). Outstanding work is mentioned in Clause 17. I ( I).
31
32
33
34
35
36
37
See cl
See cl
See c l
See cl
See cl
See cl
See cl
18.3.
18.4.
18.5.
18.2.
18.2.
18.2.
18.2.
132
Generally
10
the Works
This clause has three sub-clauses. This clause must be read with the
following Clause 20 since the next clause provides for the valuation of
variation. 'Variation' is defined in the first sub-clause, 19.1, and not in
Clause 1.1. The general definition of variation' is any change in the
original intention o f the Contract as deduced from the Contract as a
whole describing or defining the Works 1 to be carried out. 2 By
Clause l.l (d), 'Contract' means the Conditions3 and Appendix,4 the
Specifications, 5 Drawings,6 Schedule of Rates7 (if any), Bills of
Quantities (if any), the Tender,8 Letter of Acceptance,9 Agreement and
such other letters and documents as the parties may expressly identify in
writing and agree as forming part of the contract. Where the contract uses
bills of quantities, then this clause must be read with Option Module A. It
is nevertheless a variation even if it is designed to alter the use to which
the Works will be put.
I
2
Clause 19 - Variations
3
4
5
6
7
8
9
(1)
(2)
(3)
(4)
(5)
(6)
10
11
12
13
14
15
16
17
18
19
Clause 19
the amount comes only when the amount is certified as due under
Clause 32.
Employer's obligations and liabilities
Contractor
Superintending Officer
Role of the SO
The SO is empowered at any time to order vanat1ons by issuing
instructions in writing requiring such variations. If challenged and
notified by the Contractor that an instruction does require a variation
when it does not state so, the SO has the discretion, within 14 days of
receipt of the Contractor's notification, to confirm, modify, rescind or
contradict his original instruction. 23
The SO has the option of obtaining a quotation for any proposed
variation from the Contractor before issuing any instruction and may,
before or after issuing the instruction, accept the Contractor's quotation
in writing. It must be noted that an instruction requiring a variation is not
to be treated as an acceptance of any quotation.
Cross References
The clause that is expressly referred lo in this clause is Clause 20
(Valuation ofVariations). 24 'Variations' is mentioned in Clauses 7.2, 10.4,
18 .2, 21.l, 22.l(a) and 22.l(b); while Clause 19 is mentioned in
Clause 18.2; and Clause 19.l is mentioned in Clauses 13.2 and 15.1 as
well as in Clause A2.0 of the Option Module A Bills of Quantities;
Clause 19.2 is mentioned in Clause 20.4 and Clause 19.3 is mentioned in
Clause 20. l.
Employer
Employer's obligations and liabilities
While there is no express mention of the Employer's obligation or
liability in this clause, he is bound by any authorised acts of the SO.
Accordingly, if the Contractor's quotation is accepted, the Employer
would be liable to pay the accepted amount although his obligation to pay
136
23
24
See cl 19.2.
See cl 19.3.
137
Generally
Under the common law, where work is earned out pursuant to a request,
a quantum meruit may be payable by the person requesting for work
done. Similarly where parties fai l to agree a price for work done, the
common law remedy of quantum meruit may be used to ascertain the
amount payable. Thus, if parties are able to state in the contract a
mechanism to value the amount to be paid for work done. the contractual
provision would be applicable.
In the valuation of work done, there are usually two components. First,
the quantity of work done as a composite item, eg a concrete culvert
together with a full description of the component parts or as an individual
item of material such as an item of concrete. an item of reinforcement
bars of a particular diameter and other relevant description. Second,
a money rate, eg $X per number of the concrete culvert as described; $Y
per cubic metre of concrete or $Z per kg of the specified reinforcement
bar. The money rate is built from every factor affecting the cost of the
completed work, eg if the material specified is scarce. then the price may
be very high, or if the work concerned is to be carried out in very difficult
conditions, then again the price would be high so that it is reflective of the
cosl incurred in carrying out work in difficult conditions. However,
parties must be aware that the money rates may also be used as part of a
pricing strategy that does not reflect the actual cost of work done.
Since every building or construction contract wou ld have provided for
the money rates either in the bills of quantities or the schedule of rates for
lump sum contracts which do not include the bills of quantities as a
contract document. the parties may apply these rates to value the work
done as variations. Whilst the application of existing rates to value
variation works appear to be straightforward, it is in fact far from the
truth. A pre-agreement of the price for work done entails allocating lhe
risk of the uncertainty in the actual cost of carrying out the work at a later
date. This is already happening in respect of the agreed contract sum.
Any fixing of rates for variation work simply aggravates the risk factor
since there is not only uncertainty in the cost of carrying out the works
139
but there is also the uncertainty of whether the work will be carried out
and the uncertainty as regards the quantum of variation work.
The usual provision for alternative valuation methods effectively
creates a fertile ground for differences in opinion as regards which is the
applicable method, disagreement as to the value and disputes in the
interpretation of the terms like similar condition and similar character to
name two.
This clause has four sub-clauses. This clause has to be read with the
preceding Clause 19 which defines variation and provides for the
agreement of a price under Clause 19.3. If the Contractor's 1 quotation is
accepted, this clause becomes obsolete.
Although this clause is entitled Valuation of Variations. it is also used
to value work done which is described as Provisional Sum ltems2 as
provided in Clause 20.3 unless otberwise provided in the Contract. 1
The methods of valuation may be found in Clause 20.1 and 20.4.
Clause 20.4 should be considered first since the application of
Clause 20.1 is subject to it. Clause 20.4 has four paragraphs and is
applicable when the Superintending Officer (S0)4 orders in writing that
the variation works should be carried out on a daywork basis in
accordance with Clause 20.4( 1). The applicable rates are set out in
paragraph 2, namely, the daywork rates set out in the Contract or where
there is no such rate, tbe rates determined by the SO as that prevailing
when the work is actually carried out. Paragraph 3 stipulates that the
Contractor must submit to the SO for verification, daywork sheets for all
works executed on a daywork basis within three days after the work bas
been executed. The last paragraph requires the Contractor to inform the
SO in advance whenever he proposes to carry out daywork.
Clause 20.1 prescribes the methods of valuation of the variations
which are grouped under five categories:
( l)
(2)
I
2
3
4
5
6
7
140
In any event, by Clause 20.2(1 ). the Contractor is required to carry out the
work even if there is no agreement as to the valuation of the variations.
Clause 20.2(2)(a) to (f) was inserted by the 2004 edition while
Clause 20.2(2)(g) was inserted by the 2005 edition together with the
consequential amendments of replacing 'monthly statement' with
'Payment Claim" 2 and 'payment certificate' with 'Paymen~ Certificate'_.13
The amendments provide for the: (1) procedure to certify substant.J.al
completion of variation works: (2) submission of the Contractor's
valuation of variations; and (3) SO's notification of his valuation to be
followed by the Contractor's notice of disagreement, if any. Should the
Contractor fail to give a notice of disagreement, the Contractor is deemed
to have accepted the valuation of the SO and such valuation is final and
binding on the Contractor. If there is a notice of disagreement given, then
the SO may amend the whole or part of any valuation previously made
and make the necessary adjustment in the next Payment Certificate. Any
outstanding disagreement will be reconsidered by the SO when be issues
the Interim Final Account.
Contractor
14
15
16
17
I8
19
142
Employer21
Role of the SO
Where it is in his opinion necessary and desirable to order work to be
executed on a daywork basis, the SO shall do so in accordance with the
provisions of Clause 20.4.
The SO's main role under this Clause is the making of the valuation
which in his opinion is reasonable and the notification to the Contractor
in writi ng of the value of the variation.22
Where there is disagreement by the Contractor, the SO may. after
receipt of the Contractor's notice of disagreement. amend the whole or
any part of any valuation previously made. In such instance, the
provisions of Clause 20.2(2) in respect of disagreement by the Contractor
shall apply mutat is mutandis.23
The SO must ensure that the Contractor carries out the variation works
even though valuation of the variations is pending. Further, he must
certify substantial completion as required either in response to the
Contractor's written notice or on his own volition.
Cross References
See cl 20.2(2).
For definition of Employer. see cl I. I (m).
See cl 20.2(2).
See cl 20.2(3).
Sec cl 20.4(1 ).
See cl 20.1.
143
Clause 21 - Measurement
Generally
This clause has four sub-clauses. The clause spells out the procedure to
adopt when some part of the Works 1 is required by the Superintending
Officer (S0)2 to be measured. It allows for joint measurement, by the
Contractor3 and SO, which is necessary for any valuation or valuation of
any variation.4 The proper recording of joint measurements and the
appropriate procedure in the event of a fai lure to agree on measurements
are further enumerated. 5 This clause may be read with Clause 10.S which
provides fo r the examination and measurement of Works in situations
where Works are to be covered up.
In the first sub-clause, 21.1, the need for this clause is given in that this
clause is activated only when the SO requires any part of the Works to be
measured for the purpose of carrying out any valuation. presumably
whether for variations or payment certification. He must, however, give
reasonable notice to the Contractor to get the mechanism started. There is
also the stated intention that the mechanism should help achieve an
agreed measurement. This sub-clause may be read with Clause 36.2 in
respect of how the notice is to be communicated.
1
2
3
4
5
144
145
Clause 21 - Measurement
Both paragraph (b) of the first sub-clause, 21.1, and the second subclause, 21.2, together sel out what is required of the Contractor before the
actual measurement taking place.
While it is the intention of this clause to provide for a joint
measurement, the third sub-clause, 21.3, envisages that the Contractor
may not be represented at the measurement exercise and this sub-clause
therefore provides for the default situation and declares that the
mea5urements made by the SO and notified to the Contractor in writing
would be taken to be correct and final and binding in order to avoid any
dispute as regards the measurement done by the SO only.
Alternatively, the last sub-clause, 21.4, provides for the situation where
the measurement was done in the presence of the SO and the Contractor
and/or his representative but there is no agreement on the whole or part of
the measurements. The Contractor may register his disagreement as
prescribed.
Employer9
Employer's rights and remedies
Whether the measurement took place jointly with the Contraccor or not,
there is no express provision as regards the Employer's position vis-a-vis
the status of the measurement. Thus, while the Contractor may challenge
the correctness of the measurement under Clause 21.4 where joint
measurement took place, there is no express provision for the Employer
to challenge. Correspondingly, where the Contractor was not present at
the measurement carried out by the SO, it is expressly provided by
Clause 21.3 that the measurement becomes final and binding on the
Contractor but nothing is mentioned about the Employer.
Superintending Officer
Role of the SO
Contractor
Contractor's obligations and liabilities
When notified by the SO, the Contractor is obliged to attend forthwith or
send a properly qualified and authorised representative to take the joint
measurements with the SO. He is obliged to supply documents and
information necessary for such measurements. Assistance and appliances
necessary for the measurement are to be provided by the Contractor at his
own cost. 6
In breach of his obligation to attend or send a representative, the
correctness of the measurements made by the SO is imposed on the
Contractor and the measurement becomes final and binding on the
Contractor. 7
Contractor's rights and remedies
Cross References
There is no express reference to any clause. As the stated reason for
measurement is for the purposes of any valuation, including valuation of
any variation, two clauses may be relevant, that is, Clauses 20 (Valuation
of Variations) and 32 (Progress Payments and Final Account).
See cl 21.1.
See cl 21.3.
See cl 21.4.
9
I0
146
147
Generally
I
2
~~~~~~~~~
been incurred and which were not and should not have been
provided for by the Contractor; and
(iii) 15% of any such costs, such 15% to be inclusive of and in lieu of
any profits, head office or other administrative overheads, financing
charges (including foreign exchange losses) and any other costs,
loss or expense of whatsoever nature and howsoever arising.
By this definition, the Contractor's entitlement to Loss and Expense as
regards the quantum of claim is thus defined.
The clause provides for recovery by the Contractor of Loss and
Expense arising from disruption and prolongation of the regular progress
of the Works. 3 It identifies nine such events that can give rise to a claim
for loss and expense.
The extent of the Contractor's right to claim is set out in several places:
(I) to avoid duplication of claim, Clause 22. l provides that the
entitlement to Loss and Expense comes about only if the Contractor is not
being reimbursed by any other provision; (2) the grounds in support of
the Contractor's Loss and Expense claim are set out in paragraphs (a) to
(i) inclusive of Clause 22.1. There is a consequential amendment of
Clause 22.1 (g) in which the words 'artificial obstruction ' was replaced by
'adverse physical conditions' as a result of an amendment made to
Clause 5 by the PSSCOC 2004 edition; (3) Clause 22.1 further provides a
limitation to the Contractor's entitlement to Loss and Expense in respect
of situations where the same arises from or is necessitated by or is
intended to cure any default or breach of contract by the Contractor; and
(4) by Clause 22.2, it is expressly stated that the Contractor is not entitled
to Loss and Expense except in accordance with the express provisions of
the Contract. This would appear to effectively exclude the common law
right to damages for breach of contract by restricting recovery of such
claims specifically to the provisions of the Contract.~
There is another limitation to the Contractor's claim for Loss and
Expense provided by Clause 19.3. Whereas a claim for Loss and Expense
relating to variation is allowed by Clause 22. l (a) and (b), the Contractor
is not allowed to claim Loss and Expense under Clause 19.3 where the
SO accepts the Contractor's quotation for the proposed variation.
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
The proviso states clearly that the Contractor shall not be entitled to any
Joss and expense where it is related to his default or breach of contract,
Contractor
5
6
7
The Contractor's obligations and liabilities are not found in this clause
because it is the intention of this clause to set out only the Contractor's
entitlement to Loss and Expense. The foUowing Clause 23 sets out the
3
4
150
9
10
11
12
13
14
15
16
17
Generally
The clauses that are expressly referred to in this clause are Clauses 12.2
(Site Possession), 19 3.4 (Need for Further Drawi ngs, etc)20 3.6 (Delay and
Time), 4.4 (Responsibility for Identifying Ambiguities, Discrepancies,
etc), I 0.4 (Cost of Test), 10.6 (Uncovering and Making Openings), 18.2
(Cost of Remedying Defects), 18.4 (Contractor to Search), 25.1(3) (Care
of the Works)21 and 5.2 (Artificial Obstructions). 22
The term 'Loss and Expense' is mentioned in the following Clauses:
4.4(1), 4.4(3), 5.2, 10.4, 10.6, 12.3, 13.1(2), 19.3, 23.3, 25.1(3)(b) and
3 I .4(2)(b).
Indirect mentions of the Contractor's Loss and Expense claim may be
found in Clauses 23.5 and 32.1 (d).
Claims made by one party of the contract against another party may be
based on common law or the provisions o f a contract. Whereas the
common Jaw does not impose any particular procedure in general, with
exceptions like rescission wh ich must be pursued within a reasonable
time and before it affects a third party, it is not uncommon for claims
allowed by contract to prescribe a procedure for the contractual claim.
Claims are also regulated by limitation period set either by the Limitation
Act or contractually.
On the other hand, parties may contractually exclude liability or limit
liability in any claim. This mechanism may be weaved into a procedu~e
for claims. A lesson may be learned from section 13(1) of the Unfair
Contract Terms Act (Cap 396) which is beaded by the title 'Varieties of
exemption clause'. A clause may remove or reduce liability by:
(a)
(b)
(c)
Thus, it is not unusual that express provisions governing how claims can
be pursued introduce and impose a strict discipline and are in part a
logical extension of loss and expense provisions. Valid cla~ms s~ou~d
ideally be provided for and dealt with without undue delay. This ass ists m
preserving working relationships and also forces the proper r:cord _of
events while they are still fresh. A specified framework for dealing with
such cases facilitates their prompt treatment in clear and definite terms
and their payment through interim certificates once settled.
18 See cl 22. l.
19 See cl 22. l(c).
20 See cl 22. l(e).
2 1 See cl 22. I (f}.
22 See cl 22. J(g).
This clause has six sub-clauses. Th.is clause is to be read with Clause 22
which provide for the Contractor to claim Loss and Expense and other
152
153
clauses in the Contract which allows a claim. The clause sets out the
procedure to adopt if the ConLractor1 wishes to claim any payment
pursuant to the Contract2 other than in relation to the Clause 20
(Valuation of Variation) provisions. This clause should be read with
Clause 32. l (I )(d) which provides for the Contractor to include in the
Payment Claim any sum which the Contractor is entitled pursuant to
Clause 23.5.
The procedure is started by the giving of a written notice by the
Contractor to the Superintending Officer (SO) that is made a condition
precedent to the successful claim by the Contractor by the first subclause, 23.1. It would appear that the mode of communication for this
situation is not prescribed by C lause 36.2 (Notices).
The procedure also provides for the keeping and verification of
evidence in support of the Contractor's claim. Thus, the second subclause, 23.2, imposes on the Contractor an obligation to keep
contemporary records as required. Further, by the fourth sub-clause, 23.4,
access to all books, documents, papers or records in the possession,
custody or control of Lhe Contractor must be given to the S03 for him to
verify any claim submitted pursuant to this clause. Read together with
these two sub-clauses will be the sixth sub-clause, 23.6 which provides
for the default position where the Contractor did not comply fully or at all
with the two earlier sub-clauses.
The procedure also requires the Contractor to substantiate his claims
under the third sub-clause, 23.3. Within 30 days of giving his notice
under Clause 23.1, the Contractor must give one or more written
account(s) conraining details of the amount claimed and the grounds
upon which the claim is based together with particulars of any claim for
extension of time as required. Where the Contractor fails to give
sufficient substantiation, Clause 23.5(2) becomes applicable for payment
of whatever amount that has been substantiated to the satisfaction of the
SO. This sub-clause should be read with Clause 32.4 (2) (Final Payment
Claim).
The penultimate provision is the certification of such amount for
payment by the SO any claim as the SO may consider due to the
Contractor pursuant to Clause 23.5(1).
The last provision in the form of Clause 23.5(3) ensures that the
Employer is in a position to dispute the Contractor's entitlement to the
claim both in principle and quantum made pursuant to this clause and
certified as due by the SO under Clause 32. Should there be any overpayment to the Contractor, Clause 23.5(3)(b) provides for repayment by
the Contractor to the Employer.
I
2
3
Contractor
this clause, the Contractor is still required lo fulfil his obligations under
Clause 14.3(1) with regard to notice for extension of time. 8
Should the Contractor fail to comply with the notice requirement, the
Contractor is liable to bear the cost of the Loss and Expense for which
this clause allows him to claim payment from the Employer. This is
because by virtue of Clause 23.1, the notice is made a condition
precedent to any entitlement that the Contractor may have pursuant to this
clause.
However, pursuant to Clause 23.6, should the Contractor comply with
the notice requirement but fail to keep his obligations either fully or in
part, as regards keeping contemporary records and giving the SO access
to his books and documents, he is liable to bear the part of the Loss and
Expense in which the SO is not prepared to certify as due lo the
Contractor.
Further, should the Contractor fail to substantiate to the satisfaction of
the SO, then he is liable to bear the part of the Loss and Expense in which
the SO is satisfied that the Contractor is not so entitled as provided by
Clause 23.5(2).
Employer
Employer's obligations and liabilities
Although this clause has been drafted without mention of the Employer
as regards since obligation and liability to pay. the general obligation to
honour certificates may be found in Clause 32.6. The failure to make
payment would result in the Employer's liability to interest as prescribed
in the same clause.
Employer's rights and remedies
It is important to note that the SO's inclusion of any amount or payment
by the Employer in any certificate under Clause 32 will not prejudice the
Employer's right to either: (l) dispute the Contractor's entitlement to the
amount certified either in principle or as to its quantification, or (2) from
referring such dispute for decision under Clause 34. 10
Such inclusion will also not be taken into account by the SO or any
arbitrator in deciding whether there is to be any repayment by the
Contractor to the Employer of the whole or any part of such amount. 11
Superintending Officer
Role of the SO
With regard to the Contractor's keeping of contemporary records, the SO
may inspect these and may instruct the Contractor to keep any further
contemporary records which he considers to be material to the claim. It
should be noted that this is done without necessarily admitting the
Employer's liability. 12
For events having a continuing effect, the SO may at intervals require
the Contractor to submit further interim accounts of the claim. 13
In order to verify the claim, the SO shall have access to all the books
and documents kept by the Contractor for the purpose of making audit,
examination, excerpts and transcriptions. 1 ~
If all the provisions of Clause 23.1 to 23.4 have been complied with,
the SO may include amounts he consider~ due in payments certified by
him pursuant to Clause 32 (Progress Payments and Final Account). 15
In the event the Contractor fails to supply the SO with sufficient
substantiation, the Contractor's entitlement is in respect only of such part
of the amount claimed that has been substantiated to the satisfaction of
I0
11
12
13
1-l
See cl 23.3.
Sec cl 23.6.
15
156
Sec cl 23.5(3)(a).
See cl 23.5(3)(bl.
See cl 23.2.
See cl 23.3.
See cl 23.4.
Sec cl 23.5(1 ).
157
the SO. ln other words, in deciding the entitlement, the SO need not take
into account any amount which the Contractor has failed to substantiate
to his satisfaction. 16
Arbitrator
Role of Arbitrator
General ly
Cross References
The clauses that are expressly referred to in this clause are Clauses 20
(Valuation of Variations), 17 14 (Time for Completion), 18 32 (Progress
Payments and Final Account) and 34 (Settlement of Disputes). 19
Clause 23 is mentioned in Clause 19.2; while Clause 23.5 is
mentioned in Clause 32.l(l)(d). Further, sub-clauses 23.3, 23.4, 23.5(2)
and 23.6 are mentioned in Clause 32.4(2).
16 See cl 23.5(2).
17 Seecl23. l(I).
18 See cl 23.3.
19 See cl 23.5.
158
(198812 MU 69.
The sta!ement of law adopted by the coun was quoted from Holland v Hodgson
(1872) LR 7 CP 328.
159
P11blic Sector Standard Condiriom of Comract for Const metion Works 2005
building, will pass to the freeholder - quicquid pla111atur solo, solo cedit.
once the builder has affixed materials, the property in them passes fro m
him, and at least as against him they become the absolute property of his
employer, whatever the latter's tenure of or title to the land ' .J If there is a
provision in the building contract for the Contractor to unfix and re move
what has bee n fixed, this contractual right may only be used against the
Employer and not 'against a third party e ntitled to the land'. 4 The Court
of Appeal in People 's Park Chinatown Developme/1f Pre Ltd v Schindler
Lifts (S) Pte Ltd,5 adopted the principle declared by Lord Watson in Seath
& Co v Moore,6 which is, ' materials provided by the builder and portions
of the fabric, whether wholly or partially finished, although intended to
be used in the execution of the contract, cannot be regarded as
appropriated to the contract, or as sold, unless they have been fixed to or
in a reasonable sense made part of the corpus'.
The fact that the Contractor is in possession of unfixed goods brought
to the site by the goods supplier or his s ubcontractor does not make the
Contractor the owner of the said goods. The law recognises that the
supplier and the subcontractor may contractually arrange to retain the
title to the goods if payment is not made to them. This would mean that
any attempt by the Employer under the building contract with the
Contractor to vest the property of such goods in himself would fail as the
supplier7 and the subcontractor8 are not parties to the building contract
and therefore are not bound by such a provis ion, and what the Contractor
does not own, he cannot pass the property in the same to the Employer.
A few English cases are examined to shed more light on the
interpretation of some common provisions in building contracts whic h
broadly include: ( I) provisions which attempt to transfer the property in
the goods and equipment from the Contractor to the Employer and a
corresponding provision to absolve the Employe r from the responsibility
for the care of and liability for the same; (2) provisions which provide
forfeiture of the same; and (3) a transfer back from the Employer to the
Contractor presumably at the end of the contract.
In the Privy Council case (where the appeal is from Canada), Bennett
& White (Calgary) Ld v Municipal District of Sugar City No 5 [1951] AC
786, it was observed that:
3
4
5
6
7
This passage is taken from Hudso11 's Building a11d Engineering Contracts (10th ed)
p 655 and used by the Coun of Appeal in People 's Park Chinatown Development
Pte Lid v Schindler Ufts (S) Pte Ltd [1993) I SLR 591at595.
See Hobson 1 Gorrmge [ 18971 I Ch 182 at 192, H11dson 's Building and Engineering
Co111racts (10th ed) p 655 and People 's Park Chinatown De1elopme111 Pte Lid v
Schindler Lifts (SJ Pte ltd [ 1993] I SLR 591 at 595.
[1993( l SLR 59 1 at 595.
(1886) 11 App Cas 350 at 38 1.
See W Ha11so11 (Harrow) ltd 1 Rapid Cil'll Engineering Ltd and Usbome
De1elopmentslld {1987) 38 BLR 106.
See Dawber Williamson Roofing ltd v H11111berside Co11111y Council (1979)
14 BLR 70.
160
The English decided cases have dealt not infrequently with clauses of this
type: Brown v Bateman LR 2 CP 272; Blake v l;:ard 16 WR 108: Reeves "
Barlow 12 QBD 436: In re Keen & Keen (19021 1 KB 555; Hudson, Building
Contracts (7th ed) pp 396, 420; Hart v Porthgain Harbo ur Co ltd [1903] 1
Ch 690. In some of these cases a distinction has been drawn between clauses
which provide that as and when plant or materials are brought to the site they
shall be 'considered' or 'deemed' to become the property of the building
owner; and on the other hand. clauses which provide that they are to 'be and
become' his property. In the former case it has sometimes been held that the
clause was ineffective to achieve its aim and that property remained in the
builder. at the mercy of his creditors and trustee in bankruptcy: see In re Keen
& Keen [1902] I KB 555. When, as in Reeves v Barlow 12 QBD 436,
a decision of the Court of Appeal and, perhaps, the leading decision in the
field, the fonnula is 'be and become' or its equivalent, that case decides that
the clause means what it says, operates according to its tenor, and effectively
transfers the title.
In Brown v Bateman ( 1867) LR 2 CP 272, where the court was required
to interpret the effect of a transfer clause with the words 'shall be
considered' followed by a forfeiture cla use. it was held by Bovill CJ at
page 281 that:
It is not necessary to say whether that clause creates an express legal interest
in the landlord, because in my judgment it confers upon him a clear equitable
right to the materials brought upon the premi~es for the purpose of being used
in their construction, without any actual interference on his part; and none of
the cases cited show that such an equitable interest could not be created. That
being so, the materials could not be liable to seizure under an execution
against the builder. it appears to me that under the (said] clause, [the
landlord] took an immediate interest in the materials.
Similarly, In re Keen & Keen [ 1902] l KB 555, the court had to interpret
the effect of both the clauses. It was held by Bigham J at page 561 that:
But though the goods were at the date of the receiving order the goods of the
builders, the contract provided by clause 20 [the forfeiture clause] that on a
certai n contingency the plant and materials on the premises should be
forfeited to the board. The trustee. when his title to the goods accrued. took
them subject to the contingency. The builder's title to the goods was a
defeasible one, and the trustee could have no berter title. Here, the
contingency happened and transferred the property from the trustee to the
school board.
In the last case, In re Winter (1878) 8 C h D 225, Bacon CJ held at
page 228:
The contract which was made is one of the most fami liar kind. A contractor
brings plant upon the works. and he undertakes that while he is engaged on
the works it shall belong to the Commissioner, and that the things in question
are to be deemed their property, that is to say, that they shall not be removed.
He is entitled to the plant, bccau~e. if he is not, the property has passed from
him. But when the bankruptcy happens he has got this plant, and it passes to
161
his assignees as part of the estate. Does the debtor give Lo the Commissioners
any right to sell or retain this property? IL was not in the contemplation of the
parties, and the Commissioners exercised no rights of ownership. The plant
was to be deemed, for the purposes of the contract only, to be the property of
the Commissioners. They had a right to use it if it was necessary to employ
another contractor .
9
10
11
12
I3
14
15
16
17
Clause 32.l(l)(b) and (c) and Clause 32.2. Relating to this is Clause 24.5
which provides for the subsequent revesting in the Contractor of the
property in the Construction Equipment. Temporary Works, Plant,
materials and goods which have been brought onto the Site.
Although it is expressly provided for the transfer of property of the
same from the Contractor to the Employer. there are provisions as regards
how the same may be dealt with by the two parties. Thus, Clause 24.2
provides that the right of the Contractor to the sole use of the same for the
purpose of the Works is not prejudiced. Further the Contractor remains
responsible for the operation and maintenance of the same. However,
except for movement within the Site, C lause 24.l provides that the
Contractor must not remove the same or any part of the same without the
written consent of the Superintending Officer (S0). 18 On the other hand,
the Employer is by Clause 24.3 not liable as prescribed.
Clause 24.4 is dedicated to the situation where equipment is hired. It
provides for the Employer to replace the Contractor as a party in the hire
contract that is between the Contractor and the owner of the equipment in
the event of a termination as provided by Clause 3 1.
This clause is also related to Clause 3 1 which provides for the
consequences of terminatjon as regards the use of the same as prescribed
in C lause 3 1.1 (2), 3 1.2( I ), 3 l.2(2) and 31.4(1 ).
The last sub-clause, 24.6. obliges the Contractor to ensure that the
appropriate provision is found in his sub-contracts to bring about what
has bee n provided in this clause.
Contractor
Contractor's obligations and liabilities
When the Contractor brings any Construction Equipment, Temporary
Works, Plant, materials and goods onto the Site he is obliged to use the
same exclusively for the execution of the Works. Further, the Contractor
is obliged to seek the written consent of the SO to remove the same or any
part thereof except for: ( I ) the purpose of moving it from o ne part of the
Site to another; and (2) vehicles engaged in transporting any staff, Jabour,
Construction Equ ipme nt, Temporary Works. Plant, materials and goods
to and from the Site. 19
The Contractor is responsible for operating and maintaining
Construction Equipment, Temporary Works. Plant, materials and goods
as required under the Contract although he agrees that the same, when
brought onto the Site, is deemed to be the property of the Employer if
they are owned by the Contractor or by any company in whjch the
Contractor has a controlling interest. 20
18
19
20
The Contractor is not to bring onto the Site any hired Construction
Equipment unless there is in the agreement (for the hire but not hirepurchase of such Construction Equipment) a provision that the owner of
Lhe same will, on request in writing made by the Employer within seven
days after the date on which the tennination has become effective and on
the Employer undertaking to pay all hire charges. hire the same to the
Employer on the same terms in all respects as was hired by the
Contractor, except that the Employer shall be entitled to pennit the use of
the same by any other contractor employed by the Employer for the
purpose of executing and completing the Works and remedying any
Defects therein under the terms of Clause 31 (Termination by the
Employer). 21
Finally, the Contractor must incorporate in all his sub-contracts for the
execution of any part of the Works the provisions of Clause 24 in relation
to the Construction Equipment, Temporary Works, materials or goods
brought onto the Site by reference or otherwise. 22
By Clause 24.3, the Contractor agrees that the Employer is not liable
for damages of the same although they are vested in Lhe Employer.
Accordingly, the Contractor would be liable for such damage. This may
also be inferred from Clause 25.1 (I) where the Contractor is responsible
for the care of the same.
re-vest in the Contractor upon the completion of the Works and the
making good of all Defects.25
Employer
Employer's obligations and liabilities
Although any Construction Equipment, Temporary Works, Plant,
materials and goods which are brought onto the Site are deemed to be
vested in the Employer pursuant to C lause 24.2, he is not at any time
liable for loss or damage of the same. Neither is the Employer liable for
any loss, expense, costs, damages, liability or claim arising from the
presence or use of the same. 26
However. if the Employer decides, pursuant to Clause 24.4, to take
over the hire contract from the Contractor, the Employer would be liable
to pay all hire charges as prescribed.
Employer's rights and remedies
When any Construction Equipment, Temporary Works. Plant, materials
and goods owned by the Contractor or by any company in which the
Contractor has a controlling interest is brought onto the Site, it shall be
deemed to be the property of the Employer. This right is not absolute as
the Contractor may remove the same from the Site if the SO gives his
consent which although is not expressly provided ought not to be
unreasonably withheld. 27 Further, the property in the remainder of the
same revests in the Contractor upon the completion of the Works and the
making good of all Defects. 28 The Employer's right as owner of the same
is also subject to the Contractor's right to the sole use of the same for the
purpose of the Works. 29 Finally, the Employer has the right to request the
owner of the Construction Equipment, which was hired to the Contractor,
to hire the same to him as prescribed .3
Role of the employer
If the hire of Construction Equipment contract complies with the
requirements of Clause 24.4, the Employer may within seven days after
the date on which termination has become effective, where the
tennination of the Contract is brought about by the Employer under
Clause 3 1, request the owner of the hired Construction Equipment in
15
26
27
28
See cl 24.5.
See cl 24.3.
See cl 24.1.
See cl 24.S.
29 See cl 24.2.
30 See cl 24.4.
See cl 24.4.
See cl 24 .6.
See cl 24.2.
Sec cl 24.3
164
165
Superintending Officer
Role of the SO
The SO must monitor to see that the Contractor does not remove the
Construction Equipment, Temporary Works, materials or goods brought
onto the Site unless it is for the prescribed exception. However, the SO
must consider whether to give written consenl to the Contractor if the
Contractor so requests to remove any Construction Equipmenl,
Temporary Works, Plant, materials and goods from the Site. 32
Although it is not expressly stated, it is submitted that the SO ought to
have the power to request the Contractor to show that the hire of
Construction equipment contract and any of the Contractor's subcontracts for the execution of any part of the Works contain the terms
prescribed by Clause 24.4 and 24.6 respectively.
Cross References
Generally
The ownership of and responsibility for chattels and real property usuaUy
come together. In a building contract. any building materials and
equipment brought onto the site by a contraclor remains his property and
he is responsible for them unless otherwise provided until the building
materials are incorporated into the works where under the maxim
quicquid plantatur solo, solo credit, that is, what is annexed to the land
becomes part of the land, the incorporated materials become the property
of the owner of the land and therefore he is responsible for the completed
works.
Where the building contracl provides for the chauels lo be the property
of the employer. the building contract usually provides for the contractor
lo be responsible for them and additionally, the contraclor is also made
responsible for the works which are usually the responsibility of the
employer as he is normally the owner of the land, because the contractor
has possession of the site and is in the best position to be responsible for
the chattels and the works.
Intention of the Clause
This clause has two sub-clauses. Although lhe sub-head is entitled 'Care
of the Works', 1 the scope includes care of any Plant, materials or goods as
well as Construction Equipment, 2 Temporary Works, 3 structures, other
works, worker's quarters and any other things whatsoever nature required
by the Contractor for the purpose of the Contract.
As the Contractor5 has possession of the Site,6 he is in the best position
to be responsible for any completed Works and the prescribed things on
I
31
32
33
34
35
2
3
See cl 24.4.
See cl 24.1.
See cl 24.5.
See cl 24.5.
See sub-ell 24.4 and 24.5.
4
5
6
166
167
7
8
9
IO
11
Contractor
Contractor's obligations and liabilities
The Contractor is obliged to take full responsibility for the care of the
whole Works or of any phase or part of the Works which has not been
substantially completed from the date of commencement of the Works
until 14 days after the Date of Substantial Completion or the latest date if
more than one. 12 Jn addition, the Contractor is obliged to take full
responsibility for any Plant, 13 materials or goods intended for or
connected wi.Lh the Works and all Construction Equipment, Temporary
~orks, matenals, goods, structures, other works, workers' quarters on the
Site and any other things of whatsoever nature required by the Contractor
for the purposes .o~ ~e Contract. 14 Further, the Contractor is obi iged to
Lake full respons1b1hty for the care of any outstanding work which he
sh~ unde.rtake or be obl~ged to complete during the Defects Liability
Penod untll such outstandmg work has been completed to the satisfaction
~f the Superintending Officer (S0). 1s Accordingly, the Contractor is
!table for the cost of taking care of the completed works so as to avoid
any damage, loss or injury to it.
The Contractor is also responsible for the making good with all
reasonable expedition, any damage, loss or injury to the Works or parts of
the Works from any cause whatsoever except those caused by the
'excepted risks' at his own cost to the satisfaction of the S0. 16
12
13
14
IS
16
169
Public Sector Standard Condit tons of Contract for Construction Works 2005
S0. 19 Where the event of the said damage, loss or injury is attributable to
both an excepted ri sk and a risk for which the Contractor is responsible,
the Contractor is e ntitled to a fair apportionment of the costs that is
certified by the S0.211
(I )
(a)
(b)
(c)
(d)
(e)
(2)
(3)
Employer
Employer's obligations and liabilities
Superintending Officer
Role of the SO
There is reference to the following:
(I)
(2)
(3)
170
Where the Contractor is required to make good the damage, loss or injury
caused whatsoever to the Works or parts of the Works as prescribed, the
SO must be satisfied with the said making good. 26
Where the SO wishes the Contractor to rectify and make good the said
damage. loss or injury that is caused by the 'excepted risks', the SO must
issue a written instruction to the Contractor requiring him to do so. If the
Contractor complies with the said instruction, the SO shall certify any
Loss and Expense incurred by the Contractor if he has complied with the
requirements in claiming the said Loss and Expense. 27 Where the event of
the said damage, loss or injury is attributable to both an excepted risk and
a risk for which the Contractor is responsible, the SO must make a fair
apportionment of the costs so that the Employer is not obliged to pay
costs for which the Contractor was responsible under the Contract. 28
Cross References
Generally
26
27
28
29
30
31
32
33
34
This clause has three sub-clauses. This clause provides contractually, the
Contractor's obligation to indemnify the Employer in the specified
situations to the specified extent. Relating to this clause are Clauses 4.3
(a contractual obligation imposed on the Contractor to indemnify the
Employer in respect of subcontractors) and 4.7 (another contractually
172
Ian Duncan Wallace QC, Hudson 's Building and Engineering Contracts (I I th ed.
1995, Sweet and Maxwell) vol I. p 126, para 1-235.
Afderslade v Hendon Laundry [1945] KB 189.
173
The Contractor is not only responsible for the carrying out of the Works
which includes the execution and completion of the Works under
Clause 4. 1 (Contractor's General Responsibilities) but also the specified
3
4
5
6
Clause 26
lnde11111iry Prol'isions
consequences arising from his carrying out of the Works. The Contractor
is liable for and must inde mnify the Employer against any loss, expense,
costs, damages, Liability or claim whatsoever in respect of personal injury
to or death of any person whomsoever due to himself or a third party I.hat
arises out of or in the course of or by reason of the carrying out of I.he
Works.7 The said indemnity covers any damages or compensation
payable al common law or under any statute in respect of or in
consequence of any accident, illness or injury to any workman or other
person in the employment of the Contractor or any subcontractor. The
said accident, illness or injury must be caused by the Contractor, any of
the subcontractors or a third party but not an accident, illness or injury
resulting solely from any act or default of the Employer, or any person for
whom the Employer is responsible.8
The Contractor is liable for and must also indemnify the Employer
against any loss, expense, costs. damages. liability or claim due to injury
or damage of any kind of property. real or personal. including any
property of the Employer other than the Works 9 that arises out of or in the
course of or by reason of the carrying out of the Works and are due to the
Employer or a third party. For the Contractor, he is excused from the
burden of the indemnity if he can prove to the satisfaction of the SO that
it was not due to any negligence, omission. breach of contract or default
of I.he Contractor or of any person for whom the Contractor is responsible
including the Contractor's servants or agents or any subcontractors and
their servants or agents. 10
However, the Contractor is obliged to forthwith rectify any injury or
damage to any property 11 as prescribed upon receipt of the SO's
instruction to do so as long as the said instruction is issued before the
Final Completion Certificate. This obligation is without prejudice to the
Contractor's obligation to indemnify I.he Employer under Clause 26.2. 12
Should the Contractor fail to comply with the SO's instructions. this
Clause does not pro.vide for a remedy. However, a possible answer may
be found in Clause 2.7 where a failure to comply with the SO's
7
See cl 26. I ( I ).
8
See cl 26. I (2).
9 The responsibility for the Works is found m cl 15. 1(3)(a) (Care of the Works).
I 0 See cl 26.2.
11 ln cl 26.3, there is no disiinction between propert) which is the Works and property
other than the Works.
12 See cl 26.3. See also cl 25.1(3)(a) (Care of the Works) where it is provided that '[i]n
the event of any damage. loss or injury 10 the Works or parts of the Works from any
cause whatsoever (except the 'excepted risks' as defined in cl 25.2), the Contractor
shall, at his own cost, make good with all reasonable expedition such damage. loss or
injury 10 the satisfaction of the SO .. .'; and cl 28.2 (Application of Insurance
Moneys) where it is provided in sub-clause (I) that. ' (u]pon the occurrence of any
damage, loss or injury to the Works ... prior to completion from an y cause
wha1soever the Contractor shall (subject to cl 25.1(3)) proceed munediately lo
rectify and make good the ~ame free of charge ... '.
175
Employer
Superintendi ng Officer
Role of the SO
It appears from Clause 26.1 that the Employer himself will be liable
under Clause 26. I ( I) for any loss, expense, costs, damages, liability or
claim whatsoever in respect of personal injury, or death if it is due solely
to any negligent or wilful act of the Employer or of any person for whom
the Employer is responsible; a nd under Clause 26. 1(2) for any damages
or compensation payable at common law or under any statute in respect
of or in consequence of any accident, illness or injury to any workman or
other person in the employment of the Contractor or any subcontractor
which resulted from an act or default of the Employer or of any person
for whom the Employer is responsible.
Where there is injury or damage of any kind suffered by any property real
or personal including any property of the Employer other than the Works,
the SO has to decide whether the said injury or damage of any kind
caused Lo any property real or personal. incl uding any property o f the
Employer other than the Works, which arose o ut of or in the course of or
by reason of the carrying out of the Works was not due to any negligence,
omission, breach of contract or default of the Contractor or of any person
for whom the Contractor is responsible including the Contractor's
servants or agents or any subcontractors and their servants or agenls. 17
Accordingly, the SO is empowered to instruct the Contractor to rectify
any injury or damage of any kind arising to any property out of or in the
course of or by reason of the carrying out of the Works at any time before
the issue of the Final Completion Certificate. s
Employer
15
16
17
18
See cl 26.3.
See cl 26. 1(1).
176
177
Public Sector Standard Conditions of Com ract for Construction Works 2005
Cross References
Generally
This clause has three sub-clauses. It sets out the three sets of insurances3
which the Contractor must take ou t and maintain. It also provides that
the Employer~ may hi mself take out or maintain such ins urances if the
Contractor fails to do so.6
Sec cl
See cl
21 See cl
22 See cl
I9
20
26.2.
26.3.
26. I (2).
26.3.
5
6
178
'Specific Contracts' (27th ed. 1994. Sweet & \1axwell) vol II. p 885, para 39-001.
Ian Duncan Wallace QC. H11dw11 's Bui/din.~ and Engmeering Co111racts (I I th ed.
1995. Sweet & Maxwell) vol 2, p 1422, para 15-002.
See sub-ell 27. I (I) and 27 .2(2).
For definition of Contractor. see cl I. I(f).
For definition of Employer. see cl I. I (m).
See cl 27 .3.
179
Contractor
In re~pect of policy that is taken out where the Employer's interests are
noted as 'Principal', he will be so entitled under the policy. Where the
Employer is named as an 'Additional Insured'. he will correspondingly
be so entitled. In the case where the policy has the joint names of the
Employer and the Contractor, they would be so entitled under the policy.
The Employer may himself insure against any risk which the
Contractor or any subcontractor has defaulted in taking out or
maintaining the insurance policies as stipulated by Clause 27.1 and 27.2.
He may recover the premiums from the Contractor without prejudice to
any other rights and remedies that are available. 12
The three sets of insurances which the Contractor is obliged to take out
and maintain are set out below. First, insurances to cover the liability of
the Contractor or any subcontractor in respect of personal injuries or
death or the sub-contract works including any liability of the Contractor
under the Workmen's Compensation Act.7 Second, insurances which may
be specifically required by the Contract8 in respect of injury or damage to
property real or personal other than the Works. 9 Third, insurances for
such amounts of indemnity as may be specified in the Specifications 10 or
other Contract documents in respect of the prescribed loss, expense,
costs, damages, liability or claim which the Employer may incur or
sustain due to injury or damage of any kind to property real or personal
including property of the Employer but not the Works caused by collapse,
subsidence, vibration, weakening or removal of support or lowering of
ground water. 11 The need for these covers all arises out of or in the course
of or by reason of the carrying out of the Works.
Accordingly, should any policy be disclaimed by the insurer, the
Contractor would be liable in respect of the loss and damage incurred that
arose from a risk which responsibility rests with the Contractor and
which would have been covered if there was no disclaimer.
[f the Contractor fails to insure the Works or to deposit the insurance
policies or receipts for premiums as required by Clause 27, the
Contractor is exposed to the liabilities of a tennination for default by the
Employer pursuant to Clause 31.1(2)(d). Further the Contractor is liable
to the Employer in respect of any other right and remedies available to the
Employer arising from the situation leading to the termination.
Employer
Employer's obligations and liabilities
Accordingly, should any policy be disclaimed by the insurer, the
Employer would be liable in respect of the loss and damage incurred that
arose from a risk which responsibility rests with the Employer and which
would have been covered if there was no disclaimer.
7
8
Seecl27.l(a).
For definition of Contract, see cl J.l(d).
9
See cl 27. 1(b). For definition of Works, see cl I. I (ag).
10 For definition of Specifications, see cl I. I(aa).
II Seecl27.2(1).
180
Superintending Officer
Role of the SO
The Superintending Officer (S0) 13 has to give his approval of the
Contractor's choice of insurers before the Contractor is to take out
insurance policies with them under Clause 27 .14 Further, the SO must
ensure that the Contractor deposits with the SO a copy of the policy or
policies of insurance before the commencement of the work. 15 The SO
must also ensure that no later than 14 days after the date of the said
deposit, the Contractor deposits with the SO the receipts in respect of the
premiums paid under the said policy or policies. 16
In the first set of insurances which is in respect of injury and death, it is
implied that the SO must check to ensure that: (I) the insurances in
respect of personal injury and death provide for the Employer's interest to
be noted as ' Principal' for Workmen's Compensation/Employer's
Liability; (2) they cover the liability of the Contractor and any
subcontractor as required; and (3) they comply with any limitations
permitted by the Specifications or other Contract documents. 17 In
checking whether the said insurances comply with the requirements of
the PSSCOC, the SO must also be aware of any modifications to the
Workmen's Compensation Act subsequent to the taking out of the
insurance which obliges the Contractor to increase the coverage of the
insurance in respect of any additional requirements imposed by the said
modifications to the Act. 18
In the second set of insurances which i~ in respect of injury or damage
to property real or personal other than the Works, it is implied that (1) the
12
13
14
15
16
17
18
See cl 27.3
For definition of SO, see cl J.l(ab).
See sub-ell 27. 1(2) and 27.2(2).
See sub-ell 27.1(2) and 27.2(2).
See sub-ell 27. I (2) and 27 .2(2).
See cl 27.l( l)(a).
Seecl27.l(l)(a).
181
SO must check to ensure that the insurances provide for the Employer's
interests to be noted as an 'Additional Insured ' with a 'cross liability '
provision for Third Party Liability; and (2) ~e~ c_omply with w~at is
specifically required by the Contract and the linutat1ons as set out m the
Appendix.19
In the third set of insurances which cover the specified amounts of
indemnity, it is implied that the SO must check to ensure that (1) the
insurances are maintained in the joint names of the Employer and the
Contractor; (2) they comply with the amounts of indemnity specified in
the Specifications or other Contract documents; 20 and (3) they do not
cover the following injury or damage: (a) injury or damage caused by any
breach of contract, negligence, omission or default of the Contractor, his
servants or aaent or of any sub-contractor, his servants or agents or any
other person ;esponsible for the provisions of any Plant, materials, goods
or work for the Works;21 (b) injury or damage attributable to any error or
omission in the design of the Works other than work for the design of
which the Contractor is responsible under the Contract;22 and (c) injury
and damage from any of the 'excepted risks ' as defined in Clause 25.2. 23
Cross References
Generally
This clause has two sub-clauses. In this clause, the Contractor' must take
out and maintain insurance in respect of. inter alia, the Permanent
Works,2 any Temporary Works3 and all unfixed Plant,4 materials and
goods.5 It also provides that the Employer6 may himself take out or
I
2
3
4
5
6
182
183
Public Sector Standard Conditions of Com ract for Construction Works 2005
arose from a risk which responsibility rests with the Contractor and
which would have been covered if there was no disclaimer.
In addition, the Contractor must immediately rectify a nd make good
free of charge. any damage, loss or injury to the Works or unfixed Plant,
materials or goods prior to completion that arose from any cause
whatsoever as prescribed. 16
If the Contractor fails to insure the Works or to deposit the insurance
policies or receipts for premiums as required by Clause 28, the
Contractor is exposed to the liabilities of a termination for default by the
Employer pursuant to C lause 31. l (2)(d). Further the Contractor is liable
to the Employer in respect of any other right and remedies available to the
Employer arising from the situation leading to the termination.
Contractor
(2)
one set is to insure against all damage, loss or injury from whatever
cause arising other than the 'excepted risks' as defi ned in
Clause 25.2 for which he is responsible under the terms of the
Contract, the Pem1anent Works, any Temporary Works and all
unfixed Plant, materials and goods delivered on or adjacent to the
Site for incorporation into the Works but excluding tools and
Construction Equipment 10 owned or hired by the Contractor or any
subcontrac tors and any structures or other works erected on or
adjacent to the Site 11 as prescribed. The insurance coverage should
only expire 14 days after the Date of Substantial Completion 12 or
the latest Date of Substantial Completion if more than one; and
the other set is to insure against damage, loss or injury arising from
a cause occurring prior to the commencement of the Defects
Liability Period 13 for the duration of the said Defects Liability
Period.
7
8
9
I0
11
12
13
14
15
184
16
See cl 28.2(1). See abo cl 25.1(3)(a) where tt 1s provided that '[i]n the event of any
damage, loss or injury to the Works or pans of the Works from any cause what.soever
(except the "'excepted risks" as defined in cl 25.2), the Contractor shal_l, _ath1s own
cost. make good with all reai.onable expedition such damage, lossor tnJUry to the
satisfaction of the
See cl 28.2( I).
See cl 28 2( I).
so.
17
18
185
Superintending Officer
Role of the SO
The role of the SO depends on whether the Contractor is required to take
o ut the prescribed insurance for the project concerned or whether the
endorsement of the Employer's interest in an existing general policy of
insurance of the Contractor is required.
In the first situation, the SO has to approve the terms of the insurance
which the Contractor is obtaining which must expressly provide for the
payment in the first place to the Employer of any insurance moneys due
under the insurance policy. 20 In particular, it is implied that the SO is
required to check 21 that the prescribed risks are insured in the joint names
of the Employer and the Contractor to the value of not less than the
Contract Sum 22 shown in the Letter of Acceptance. 23 Further, the SO must
ensure that the Contractor deposits with the SO a copy of the policy or
policies of insurance before the commencement of the work. The SO
must also ensure that no later than 14 days after the date of the said
deposit, the Contractor must also deposit with the SO the receipts in
respect of the premiums paid under the said policy or policies. 24
In the second situation, the SO must approve the insurers with which
the general policy of insurance is taken. He must ensure that the general
policy is endorsed with the Employer's interest and that it provides for the
payment of insurance moneys to the Employer. The SO is empowered to
demand that the Contractor produces as and when required, by the SO,
the current certificates of insurance from the insurers confirming the
existence and continuance of the relevant cover required. T he SO must
19
20
21
22
23
24
See cl 28.1(3).
See cl 28. I (2).
See cl 28.1(1).
For definition of Contract Sum. see cl l.l(e).
For definition of Letter of Acceptance. see cl I. I (p).
See cl 28. 1(2).
186
Cross References
The clauses expressly referred to in this C lause are Clauses 17
(Substantial Completion),28 25 (General Responsibilities),29 25. I (3) (Care
of the Works)' and 25.2 (Excepted Risks). 31 Clause 28 is mentioned in
Clause 31.1 (2)(d) which provides for the Termination for Default by the
Employer. Further, moneys stated to be recoverable by the Employer
from the Contractor in this Clause may be recovered as provided by
Clause 35 .
25
26
27
18
29
30
31
187
Generally
Usually, the tenns of a conslruction contract would provide for the
parties' respective interesl although it is possible to have a contract where
lhe objective is to benefit a third party. Thus, where the contractor causes
any damage, loss or injury to property belonging to a third party, the
contractor is not contractually liable to the said third party in respect of
the same unless the contractor is liable under a statute like the Contracts
(Rights of Third Parties) Act. Any liability incurred on the part of the
contractor under the circumslances would be under the law of torts which
is more difficult to establish since the plaintiff third party must be able to
establish all the ingredients of the particular LOrt under which the plaintiff
third party is claiming and it is open lo the contractor to raise an
appropriate defence to neutralise completely or partially the plaintiff's
claim.
Further, if the said damage, loss or injury is caused by the contractor's
subcontractor, the contractor may not be liable since the subcontractor in
law is an independent contractor for which the contractor is vicariously
liable under tort. The contractor's responsibility towards the said plaintiff
would be limited to the duty to select a competent sub contractor. In
D & F Estates Ltd & Ors v The Church Commissioners for England &
Ors, 1 the House of Lords held that ' ... the Court of Appeal's primary
ground for allowing [the contractor] Wates' appeal was that they had
properly employed competent subcontractors to do the plaster work for
whose negligence they were not liable .... It i~ trite law that the employer
of an independent contractor is. in general, not liable for the negligence
or other torts committed by the contractor in the course of the execution
of the work'.
If a contract provides for the employer to pay the third party, a failure
on his part to make payment does not entitle the third party to commence
an action against the employer to recover the sum so payable. This is
(1988)41 BLR I at31.
189
because under the doctrine of privity of contract, the third party not being
a party to the said contract cannot sue the employer. Alternatively, under
the doctrine of consideration, a party who has not given any consideration
to the other party who is in breach is not entitled to commence an action
against the other party for breach of contract. However, the employer may
be liable under a statute like the Contracts (Rights of Third Parties) Act.
Further, any payment made by the contractor to the employer pursuant
to a contrac tual arrangement for the employer to forward the money to
the third party does not relieve the contractor from his liability towards
the third party, if any. In any event, even if the third party has received
money from the employer, the third party is not prevented from
commencing an action against the contractor to recover the amount which
the contractor is liable to pay to the third party.
Intentio n of the Clause
5
6
190
Clause 29
Seecl29.l(I).
Seecl29.l(l).
See cl 29. I(I).
See cl 29. 1(2)(a).
191
Employer
Employer's obligations and liabilities
After the Employer has recovered the said cost from the Contractor, there
are ob ligations imposed on the Employer in three situations. First, the
Employer must release the balance of the sum withheld to the Contractor
as soon as the cost payable by the Contractor has been ascertained and
deducted from the sum retained, where the cost was not ascertained
earlier and the Employer had withheld a sum of money that was payable
to the Contractor.'' Second, the Employer must pay the amount to the
relevant authority where the affected property does not belong to the
Employer upon payment or deduction of such cost being made where. the
cost was ascertained. 12 Third, in both cases, upon payment or deduction,
the Employer must furnis h to or procure for the Contractor such
discharge or release as the Contractor may reasonably require. n
If the Employer fails to comply with the abovementioned obl igations.
he would be liable for breach of contract.
Employer's rights and remedies
The Employer has a right to recover the said cost if the fo llowing are
establi shed:
( l)
(2)
(3)
(4)
the property that suffered damage, loss or injury other than the
Works belonged to the Employer or the government or any other
s tatutory or public authority;
the said damage, loss or injury was caused by the Contractor o r any
person for whom the Contractor is responsible including the
Contractor's servants and agents or any subcontractors and their
servants and agents;
the said damage, loss or injury arose directly or indirectly out of or
in relation to or in connection with the design for which the
Contractor is responsible, construction or completion of the Works
under the Contracc; and
the amount payable as itemised in a certificate given by the
Employer or the government or any other s tatutory or public
authority.
However, this right is s ubject to the extent that the Contractor may prove
to the satisfaction of the SO that the cost or any part of it was not caused
by any negligence, omission, breach of contract or default of the
Contractor or any person for whom the Contractor is responsible where
the Employer or the government or any other statutory or public authority
11
12
13
Clause 29
Superintending Officer
Role of the SO
The role of the S0 16 under this clause has two parts. First, if the cost of
making good the prescribed damage, loss or injury to property has not
been ascertained at the time any moneys payable to the Contractor are
due for release to him, and if the Employer wants to know the amount
which he may withhold, the SO must give his opinion as to what s um of
money would be suffic ient to cover the Contractor's liability to pay the
said cost of making good as the Employer may only withhold the amount
given by the S0. 17
Second, when the itemised certificate is presented to the Contractor by
the Employer for the recovery of the cos t of making good of the
prescribed damage, loss or inj ury, and when the Contractor sets out to
prove the extent to which the amount or any part of it was not caused by
any negligence, omission, breach of contract or default of the Contractor,
or any person for whom the Contractor is responsible, the SO must decide
on the amount which the Contractor has satisfied him that the Contractor
is not responsible for. 18
Others
Position of othe rs
14
15
I6
17
18
192
Seecl29.l(I).
See cl 29.1(2)(bJ.
For definition of Superintending Officer. see cl I l(ac).
See cl 29. I(2)(b).
See cl 29. I( I).
193
said owner by the Employer if the Employer is paid the said cost or the
Employer has deducted the same from moneys due to the Contractor. 19
It is expressly provided that the remedy at law which the owners of the
property that has suffered damage, loss or injury under the circumstances
against the Contractor is not affected by the arrangement for
compensation under Clause 29. 20
Generally
2
3
194
195
parties'. It is further said that ' [a]ssignments normally take effect "subject
to equities" . .. . Thus, where a claim arises out of contract under which
the debt itself arises, and the claim affects the value or amount of the debt
which one of the parties purported to assign for value, then if the assignee
subsequently sues, the other party to the contract may set up that claim
(including the right to set the contract aside) by way of defence against
the assignee as cancelling or diminishing the amount to which the
assignee asserts his rights under the assignment' .J
Both in England and Singapore. the principles of the common Jaw
governing assignments became statutory. Thus in Singapore, section 4(8)
of the Civil Law Act provides that:
Assignment of debts and choses in action effectual to pass right and
remedy
Any absolute assignment by writing under the hand of the assignor, not
purporting to be by way of charge only, of any debt or other legal chose in
action of which express notice in writing has been given to the debtor, trustee
or other person from whom the assignor would have been entitled to receive
or claim such debt or chose in action, shall be and be deemed to have been
effectual in law, subject lo alJ equities which would have been entitled to
priority over the right of the assignee under the law as it existed before 23rd
July 1909, to pass and transfer the legal right to such debt or chose in action,
from the date of such notice, and all legal and other remedies for the same,
and the power to give a good discharge for the same, without the concurrence
of the assignor.
contract were not brought into direct contractual relations with third
parties'. 5
On the other hand. the assignment of burdens or contractual
obligations is not treated as assignment of benefits. Sir R Collins MR said
in Tolhurst v Associated Portland Cement Manufacturers Ltd: '[n]either
at law nor equity could the burden of a contract be shifted off the
shoulde rs of a contractor onto those of a nother without the consent of the
contractee' .6
Further. where the whole contract where both benefits and burdens are
transferred to a third party where all three parties agree, there would be a
novation taking place. Thus in Chitty 0 11 Contracts, it is said that, ' [t]he re
is no doubt that with the consent of both contracting parties all contracts
of any kind may be transferred, and the term " novation" has been
introduced from Roman law to describe this species of transfer. Novation
takes place where the two contracting parties agree that a third, who also
agrees, shall stand in the relation of either of them to the other. There is a
new contract and it is therefore essential that the consent of all parties
shall be obtained: in this necessity for consent lies the most important
difference between novarion and assignment' .7
Intention of the Clause
This clause has two sub-clauses. Jn sub-clause 30.1, there are two main
parts. The first emphasis is on the personal performance of the
Contractor as regards three things known as the principal functions of
the Contractor. namely: (I) controlling the Site9 with his own Site staff;
(2) co-ordinating the work of any sub-contractors; and (3) ordering of
materials and goods for the Works. 10 The second emphasis is on obtaining
the Employer's 11 agreement in writing for what would otherwise be
prohibited in respect of four things. namely: (I) the assignment of the
Contractor's interests, rights or benefits under the Contract; 12 (2) the
transfer of the Contractor's liability; (3) the making of arrangements for
the vicarious performance of the Contractor's princ ipal functions by any
other person; and (4) the making of arrangements for the execution of the
Works being carried out by another person or persons.
ln sub-clause 30.2. there is a prohibition of the Contractor e ngaging a
subcontractor unless the Superintending Officer (S0) 13 gives prior written
6
7
8
9
10
11
12
13
Contractor
Superintending Officer
Ro le of the SO
In the event that his written consent for subcontracting is sought, the SO
shall not unreasonably withhold such consent.14
Cross References
14
See cl 30.2.
199
Generally
It can be said that usually at the time the parties entered into a contract, it
must have been with the intention to completely perform their respective
part of the bargain in a contract. However, situations may arise which
entitle either party to put an end to the contract. Under the common law
doctrine of repudiation, a party who indicates that he is no longer willing
to be bound by the terms of the contract commits an act of repudiation.
The other party may decide to accept the act of repudiation thereby
putting an end to the contract or he may insist on the carrying out of the
contract and treat the act of repudiation as an act of breach of contract. In
Dong Yuan Hang Trading Pte Ltd v Sunko (Singapore) Co Pte Ltd, 1 the
Court of Appeal adopted the decision of the House of Lords in Forslind v
Bechely-Crundal/2 which held that '[i]f one of the parties to a contract,
either in express terms or by conduct, leads the other party to the
reasonable conclusion that he does not mean to carry out the contract, this
amounts to a repudiation which will justify the other in treating the
contract as at an end, and claiming damages on that footing, without
waiting for the time when, by the contract, performance was to have
taken place'.
However, it is not easy to determine whether an act of repudiation has
actually been committed. This may be borne out by the decision of the
Court of Appeal in San International Pte Ltd (fka San Ho Huat
Construction Pte ltd) v Keppel Engineering Pte ltd3 where it was held
that:
Not every intimation of an intention not to perform or of an inability to
perform some part of a contract will amount to renunciation [repudiatory
breach]. In the case of an entire and indivisible contract, a refusal to perform
any part of the agreement will normally entitle the innocent party to treat the
contract as discharged. Otherwise, a renunciation of some but not all the
obligations under a contract will not entitle the innocent party to rescind the
I
2
3
lt may be said that the contract is discharged. However, all the rights
which have accrued prior to the discharge remains unaffected but where
the rights have yet to accrue, they do not exist. Again in Engineering
Construction Pte Ltd v Attomey Genera/5 where the liquidated damages
did not come into existence at the termination of the contract, it was held
by Lim Teong Qwee JC that '[t)he right to LAD was not merely
postponed to a future date or contingent upon some event not involving
further performance of the contract. Notwithstanding that the contractor
had overrun the date for completion and the extension of time under the
first extension of time certificate the right to LAD had not come into
existence at the time the contract came to an end before completion of the
works'. The consequences that follow the termination of a contract.
especially a construction contract. can be very complicated ranging from
ascertaining the outstanding payments due and owing from one party to
the other to the use of the contractor's plants, equipment. and materials
which are on site at the time of the termination to the giving up of
possession of the site.
4
5
7
8
9
I0
11
202
(5)
Contractor
(3)
(c)
(4)
(6)
(I)
22
23
2.i
25
26
27
28
(4) not to fail to insure the Works nor to deposit insurance policies or
(5)
(b)
(c)
(2)
(b)
(c)
(l)
206
(2)
(3)
38
This clause does not expressly remove the Employer's common law right
to terminate the Contract and the Employer's common remedies made
available on the Employer's acceptance of the Contractor's act of
repudiation.
See cl 31.2(3).
See cl 31.4(2).
208
39
40
41
See cl 31.2( I)
See cl 31.2( I ).
See cl 31.3.
209
Superintending Officer
Role of the SO
The role of the SO may be broadly divided into two parts, namely, the
respective roles in pre-termination and post-termination. Before the
contract is terminated, the SO's role is limited to a termination pursuant
42
43
44
45
See cl 31.1(2)
See cl 31.2( I).
See cl 31.2( I).
See cl 31.4( I).
210
211
and all other expenses incurred by the Employer.49 Subseque ntly, the SO
may decide to certify an amount payable to the Contractor upon due
completion of the Works by the contractor after deducting the Employer's
Cost. 50
To allow the Employer to claim liquidated damages fro~ the
Contractor after the employment of the Contractor has been tenmnated
for default if applicable. the SO must issue a certificate if the completion
of the Works or phase or part by the Employer or by other contractors or
persons appointed by the Employer to complete the Works or phase or
part has been delayed beyond the Time for Completion. The SO must
certify the following:
the date upon which the Contractor should have completed the
Works or phase or part;
(2) the full period of delay for which the Contractor is responsi?Ie. In
assessing the period of delay, the SO must reduce the penod of
delay to the extent that there has been any failure by the Employer
or by any other contractor or persons engaged by the Empl~yer to
use due diligence and expedition in arranging for or completmg the
remaining parts of the Works or phase or part;
(3) the total damages due to the Employer therefore; and
(4) the credit for events occurring after the termination of the
Contractor's employment which would have entitled the Contractor
to an extension of time had he duly executed and completed the
51
Works or phase or part and duly complied with Clause 14.
(I )
for all work executed prior to the date of termination at the rates for
the Works set out in the Contract including:
(a)
49
50
51
See cl 31.2(3 ).
See cl 31.2(3).
See cl 3 1.3(2).
2 12
Cross References
The clauses expressly referred to in this clause are Clauses 4.5 (Security
Deposit),53 9 (Programme for the Works).54 13.2 (Suspension Lasting
More than 90 Days), 55 14 (Time for Completion),56 23 (Procedure for
Claims),57 27 (Insurance for Personal Injury, Work.men 's Compensation
and Property Damage),58 28 (Insurance of the Works),s9 30.1
(Assignment by Contractor),611 30.2 (Subcontractors), 61 3 1 (Tenni nation
by the Employer),62 31. 1(2) (Tennination fo r Default),63 31.3 (Liquidated
Damages after Tennination).64 31.3(2) (Liquidated Damages after
Tennination)65 and 3 1.4( I) (Termination Without Default).66
Clause 31 is mentioned in Clause 13.2 which concerns the suspension
of Works and allows the Contractor to initiate a tennination as prescribed
but treated as a tennination by the Employer under Clause 31.4. Clause
31 is also mentioned in Clause 36.2(4) as regards the giving of notices in
respect of termination by the Employer.
Clause 31 is also mentioned in Clause 24.4 and 24.5 which is
concerned with the use of any Construction Equipment hired by the
Contractor and the revesting and removal of any Construction
Equipment, Temporary Works, materials or goods upon tennination.
Further, it is provided by Clause 34.3 that if there is a dispute or
difference concerning tennination of the Employment of the Contractor
or the repudiation or abandonment of the Contract by either party, such
dispute or difference may be referred to arbitration/litigation without first
referring the matter to the SO in accordance with Clause 34.2( I)(a).
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
See cl 31.4(2).
See cl 31.1(2)(c).
See cl 31.l( l )(c).
See cl 31.2(2).
See cl 31.3(2).
See cl 31.4(2).
See cl 31. 1(2)(d).
See cl 31.l (2)(d).
See cl 31.l(l)(e).
See cl 31.l(l)(e).
See cl 31.2(1 ).
See cl 31.2(1 ).
See cl 31.2(3).
See cl 31.3(3 ).
See cl 31.4(2).
213
Generally
The obligation to pay in a building and construc tion contract belongs to
the employer as it represents his part of the consideration. Under the
common law, the parties may agree Lo treat the contract as an entire
contract where payment to the Contractor is made upon the entire
completion of his Works subject to the exceptions like substantial
performance. 1 On the other hand, the parties may agree to provide for
interim payment with a final payment that looks at any outstanding
payment to be made before the obligation to pay is discharged under the
obligation to make a final payment. In recent years, the payment
obligation has been regulated by statute. In Singapore, the Building and
Construction Industry Security of Payment Act 2004, which came into
operation on I April 2005, regulates progress payment by facilitating the
securing of such payment through adjudication and the consequential
statutory remedies against non-payment including, inter alia, the
suspension of works. It may be inferred from the Act as it is not expressly
provided that the parties may operate both a contractual scheme of
payment in parallel with the statutory scheme of payment provided by the
Act.
In the case of interim payments, a certification process is usually
adopted where the parties must agree to the appointment of a certifier, the
method of valuation for the amount to be certified, the mechanism for
certification and payment in which the certificate sets out the amounts
which the contractor is entitled to while leaving the employer to his right
to set-offs.
The role of a certifier has been authoritatively stated by the Singapore
Court of Appeal in Hiap Hong & Co Pte Ltd i Hong Huat Development
Co (Pte) Ltd [2001] 2 SLR 458 at [35]:
See Sapiahtoon v Lim Siew Hui I 19531 MLJ 305; Building Estate Ltd v AM Connor
[ 19581 MU 173 and Hoenig v Issacs [I 952] 2 All ER 176.
215
matters where the architect is accorded a special role under the contract and
where he is expected to exercise independent judgment.
37 A refusal by a certifier to issue a certificate, or the withholding by the
certifier of a certificate, can fall under one of two categories: (i) because
nothing is due on the merits: or (ii) due to failure by the certifier to give any
consideration to the matters upon which such issue will depend. Obviously
for the first category of refusal or withholding, there would be no implied
undertaking by the owner that his architect would certify. Even for the second
category it is also doubted that there is such an implied undertaking.
It 1s vitally important to bear in mind the nature of the duties of the architect
when he is exercising then function of a certifier. As stated before, it is senled
law that he is to act fairly and independently. He is not subject to the
directions or instructions of either party although he must listen to both
parties before he arrives at his own decision. Thus, in exercising the function
of certification the architect cannot be the agent of the owners. The nature of
that function is wholly inconsistent with the architect being an agent of the
owner.
This requirement for the certifier to be impartial is not overridden by any
departmental policy where the certifier is an employee within the
employer's organisation. Thus, in Perini Co1poration v Commomvealrh
of Ausrralia, 2 Macfarlan J stated that:
The second matter which I must mention is the entitlement of the Director to
consider Departmental policy. This point must be judged against a
background that the Director is the senior officer of the Department in New
South Wales, that he is obliged to carry out the orders of his superiors and that
he has many duties under this very agreement which he performs as the
servant of the Commonwealth, and in the perfonnance of which he is obliged
to execute and give effect to Departmental policy. I am of opinion that in
discharging the duties imposed upon him by clause 35 he is entitled to
consider Departmental policy but I am also of the opinion that he would be
acting wrongly if he were to consider himself as controlled by it. His
overriding duty in perfonning the function imposed by clause 35 is to give his
own decision having regard to the rights and interests of the parties as I have
described them.
In any event, in East Ham Corp v Bernard Sun!(!)' & Sons, 3 Lord Dilhome
said, while referring to an architect acting as a certifier, that:
Each month he had to certify the value of the work properly executed. It
follows that at least once a month he had to examine the work done and
satisfy himself that it had been properly done. Presumably he would keep
himself infonned of the progress of the work and, while the contract did not
require him or his representatives to be always upon the site, he would regard
it as his duty to go there or to send his representative there to inspect the
sufficiency of the work done. particularly when an important stage of the
building was being completed.
So when one is concerned with a building contract one starts with the
presumption that each party is to be entitled to all those remedies for. its
breach as would arise by operation of the law, including the remedy of setting
up a breach of warranty in diminution or extinction of the price of the ~aterial
supplied or work executed under the contract. To rebut that presumption one
must be able to find in the contract clear unequivocal words in which the
parties have expressed their agreement that this remedy shall not be available
in respect of breaches of that particular contract.
2
3
4
216
5
6
7
218
219
_- -V""
VJ ....
Alternatively, by part (b), the SO must issue the Final Account Certificate
within 30 days from the date the SO informs the Contractor in writing
that he would not issue a notice of amendment to the Final Account. The
two options, however, would not be helpful to the SO where the SO has
issued the notice of amendment but there is no acceptance or deemed
acceptance of the Final Account.
The seventh limb, 32.5(7), prescribes the content of the Final Account
Certificate. It certifies the difference between: (a) the adjusted Contract
Sum and an amount which the SO considers the Contractor to be entitled
to pursuant to the Contract; and (b) the amounts so far certified for
payment, whether or not paid.
The next limb, 32.5(8), provides for the prescribed amendments of the
Final Account and/or the Final Account Certificate within 30 days of the
issue of the Final Account Certificate or the Final Completion Certificate,
whichever is the later.
The last limb, 32.5(9), expressly provides that the SO is not obliged to
issue the Final Account Certificate before the issue of the Final
Completion Certificate. However, the issue of a Final Account or a Final
Account Certificate before the Final Completion Certificate shall not
relieve the Contractor from his obligations and liabilities arising during
the Defects Liability Period.
The sixth sub-clause, 32.6, provides for the Employer's honouring of
the SO's certificate issued pursuant to Clause 32 or any other term of the
Contract. It is expressly provided that the certified amount is to be paid
by the Employer to the Contractor subject to the Employer's right to
deduct or set-off any sum or damages for which the Contractor is or may
be liable under the Contract or in any other way. The payment must be
made within 21 days or such other time period as may be stipulated in the
Appendix after the date of the SO's certificate. This sub-clause also
prescribes the rate of interest payable upon all sums unpaid from the date
which the same should have been paid.
The seventh sub-clause, 32.7 has six limbs and regulates the claim and
payment of Goods and Services Tax (OST). The first limb. 32.7( I),
provides that OST is deemed not to have been allowed in the Contractor's
te~der. The second limb, 32.7(2) provides that the Employer is obliged to
reunburse the Contractor any OST charged unless the Contractor is not a
taxable person under the OST Act. The third limb, 32.7(3), provides for
the Contractor to claim OST. The fourth limb, 32.7(4). provides for the
Employer to arrange for him to issue to himself the tax invoice. The fifth
limb, 32.7(5), provides for the co-operation of the Employer and the
Contractor in a situation where there is any dispute, difference or
question that may arise between either the Employer or the Contractor
and the Comptroller of OST. The last limb, 32.7(6), declares that
Clause 34 does not apply to any dispute. difference or question under
Clause 32.7.
. The last sub-clause, 32.8, expressly provides that the Employer is not
hable to pay to the Contractor any damages whether by way of interest or
222
223
Contractor
(2)
(3)
(4)
(5)
(I)
(2)
Sec cl 32.5(3) where the draft of the fi nal account is referred to as the 'Final
Account'.
20 See cl 32.5(4).
21 See cl 32.5(8).
19
l6
17
18
See cl 32.4.
For definition of Contract Sum, see cl l.l(d).
See cl 32.4.
224
225
22
23
24
25
26
27
See cl 32.5(6).
See cl 32.5(6).
See cl 32.5(9).
See cl 32.7.
In the first edition of the PSSCOC. it was 14 days.
See cl 32.7(4).
226
Like ~is obliga~ions and liabilities, the Contractor's rights and remedies
are . discussed m three sets, namely, those relating to the payment
certificates, matters relating to the Interim Final Account the Final
Account and the Final Account Certificate and GST.
'
In Clause 32, there are two main aspects of concern for the Contractor
namely, his ~resc~bed entitlements and the constraints imposed on him i~
r~spect of his entitlements relating to the monthly payment certificates.
First, the Contractor is entitled to both certifications by the SO and
payments by the Employer. Every month, the Contractor is entitled to
receive a certificate from the SO certifying the amounts to which the
Contractor is in the SO's opinion entitled in respect of each of the
amounts in the payment claim submitted by the Contractor29 and then to
receive .payment.s from the Employer pursuant to Clause 32.6 (Period for
Ho~ounng .certificate). However, it is to be noted that the SO is only
obliged to issue these certificates within 14 days of the receipt of the
Contractor's payment claims as prescribed. ''1
Where there is any error in any previous certificate and the SO issues a
ce~ificate to correct the said error, the Contractor would accordingly be
enutled to the payment of any additional amount if the error corrected is
one of undervaluation. 11
~ith the 2005 edition, the status and meaning of the SO's Payment
~en1ficat.e has changed because it is contingent on whether the Employer
issues. his P~yment Response pursuant to Clause 32.2(2) and in
compliance wnh the Building and Construction industry Security of
P~y~ent Act 2004. ff the Employer does not issue his Payment Response
w1thrn 14 days from the Contractor's Payment Claim, then the SO's
Payment Certificate is deemed to be the Payment Response from the
Employer and the Contractor presumably is entitled to treat it as such. It
28
29
30
31
227
would appear that it is the intention of the drafters of PSSCOC that the
Contractor would be entilled to dispute the Employer's Payment
Response and proceed with the application for adjudication as prescribed
by the said Act.
In respect of the Interim Final Account, the Contractor is entitled to
receive the same from the SO regardless of whether the Contractor
submits his Final Payment Claim. However, the consequences are
different.
In the first scenario where the Contractor submits a Final Payment
Claim, he is entitled to receive not only the SO's Payment Certificate that
is based on the Interim Payment Certificate but the corresponding
payment by the Employer pursuant to Clause 32.6 (Period for Honouring
Certificate). The Contractor is then entitled either: (a) to receive from the
Employer. his Payment Response in compliance with the Building and
Construction Industry Security of Payment Act 2004; or (b) failing
which, to treat the SO's Payment Certificate as the deemed Payment
Response from the Employer. Accordingly, it was intended by the
drafters of PSSCOC 2005 that this would have entitled the Contractor as
Claimant under the said Act to dispute the Employer's Pay ment Response
and to apply for adjudication under the Act as prescribed. However, as
explained in the section on the intentions of this clause, it is submitted
that the purported Final Payment Claim cannot be a payment claim as
prescribed by the said Act and may be treated as an attempt to contract
out of the Act and therefore invalid or it may be treated as a contractual
arrangement rather than a successful attempt at complying with the said
Act.
In the second scenario where the Contractor fails to submit a Final
Payment Claim, then the Contractor is nevertheless entitled to receive
from the SO his Interim Final Account within 150 days of the Date (the
last Date) of Substantial Completion and also his payment certificate
based on the Interim Final Account within 30 days after the issue of the
Interim Final Account. In this case, the Contractor is entitled to dispute
the interim Final Account and submit his grounds of dispute to the SO.
Unfortunately, no period is stated for the Contractor to submit his dispute
and grounds of dispute. If the Contractor does so, he is entitled to receive
from the SO either (a) the SO's notice of amendment informing the
Contractor about the amendments made by the SO; or (b) the SO's notice
that the SO would not be issuing the said notice of amendment. In this
second scenari o, the arrangement does not lead to the Contractor being
entitled to pursue adjudication under the said Act as is intended in the
first scenario.
By Clause 32.5(3), the Contractor is entitled to receive from the SO a
draft of the final account known as the Final Account not later than 30
days after the end of the Defects Liability Period, the period of which can
be found in the Appendix. The Contractor's rights and remedies are
dependent on his response. Three possible scenarios are expressly
provided for in C lause 32.5(4).
228
229
Employer
Employer's obligations and liabilities
Prior to the 2005 edition, the Employer's obligations touch on three areas.
First, he is not liable to the Contractor for any damages whether by way
of interest or otherwise. for any failure or delay by the SO in certifying
any payment due or payable to the Contractor.34
Second, the Employer must pay the Contractor, within 21 days or such
other time period as may be stipulated in the Appendix after the date of
suc h certificate, the amount due to the Contractor under any certificate
issued by the SO pursuant to Clause 32 or any other term of the Contract,
subject to the Employer's right to deduct or set-off any sum or damages
for which the contractor is or may be liable under the Contract or in any
other way. If he fails lo make payment within the times stipulated, the
Employer must pay to the Contractor interest at the rate stated in the
32
33
34
See cl 32.6.
See cl 32.4(2).
See cl 32.8.
230
35
36
37
38
39
40
See cl 32.6.
See cl 32.7(2).
See cl 32. 7(5).
See also cl 35.
See cl 32.3.
See cl 32.5(5).
231
Third, the Employer has the right to deduct or set-off any sum or
damages for which the contractor is or may be liable under the Contract
or in any other way against any amount due to the Contractor under any
certificate issued by the SO purs uant to Clause 32 or any other term of the
Contracl. 41
as used in the Act supports the Employer's defence, set-off and counterclaim against the Payment Claim of the Contractor. However, it has
already been argued earlier that the SO's Payment Certificate cannot be
used as a Payment Response as prescribed in the Act because what is
certified by the SO is the amount which in the SO's opinion is entitled as
compared to what the Act requires of a Payment Response which is what
the Respondent Employer proposes to pa} the Claimant Contractor.
Should the SO find any error in any certificate, he is empowered, and
in the circumstances warranting it, to make any correction or
modification in respect of any error whether arithme tical or otherwise in
any previous certificate which has been issued by him and make such
adjustment as may be necessary in the amount of payment due and
payable to the Contractor to take into account any over or under valuation
in any previous certificate.43
The other part of the SO's role prescribed in this clause concerns the
issue of the Interim Final Account introduced by the 2004 edition of the
PSSCOC, the Payment Certificate based on the Interim Final Account,
Final Account and Final Account Certificate.
There are two routes dictating the issue of the Interim Final Account.
The ftrst route is triggered by the submission of the Final Payment Claim,
the form of which the SO may prescribe. As explained already, this would
amount to infringing the anti-contracting out provision of section 36 of
the Act thereby invalidating the provision for the purpose of the A ct.
Subsequently, the SO issues the Interim Final Account within 21 days of
receiving the Contractor's Final Payment Claim pursuant to
Clause 32.5(1)(a). This is an interim assessment of the draft final
account. At the same time under the same clause, the SO issues a
Payment Certificate which must comply fu ll y with the requirements for
Payment Response. By Clause 32.5(l)(b). this certificate is deemed to be
the Pay ment Response from the Employer if the Employer fails to
provide a Payment Response himself.
The second route is an alternative one where the Contractor fails to
submit a Final Payment Claim. By Clause 32.5(2)(a), the SO must
nevertheless issue the Interim Final Account within I 50 days from the
Date (the last Date) of Substantial Completion. Subsequently, within 30
days after the issue of the Interim Final Account, the SO must issue a
payment certificate based on the Interim Final Certificate. However, there
is an important difference as regards the status of this certificate. This
certificate shall not be used as a deemed Payment Response. Indeed, it is
expressly provided that the Interim Final Account and the payment
certificate shall not be subject to the Act.
Un like the monthly payment certificate, the provision by the SO to the
Contractor of a copy of the draft of the final account, which is known as
the Final Account, is not dependent on any submission to be made by the
Superintending Officer
Ro le of the SO
The role of the SO in this clause may be seen as divided into two parts,
namely, the issue of the monthly Payment Certificates and the matters
relating to the finalisation of the accounts as between the Employer and
the Contractor.
The SO as a certifier in respect of monthly payments to the contractor
in this clause is concerned with the issue of the monthly Payment
Certificate under Clause 32.2( 1) for which the SO may decide to
prescribe, from time to time, the form in which the Contractor must
submit the Payment Claim showing the amounts which the Contractor
considers himself to be entitled up to the last day of the monthly interval
in question. 42 Under the Building and Construction Industry Security of
Payment Act 2004, it is provided that the form is to be statutorily
prescribed and, by section 36, comracting out of the provisions of the Act
is not allowed and all such provisions are invalid. It is submitted that this
provision is invalid and the form must be as prescribed by the Act and the
Regulations. In any event, the Payment Claim cannot contain anything
other than the prescribed items of claim in Clause 32.1.
It is to be inferred from Clause 32.2 that unless the Contractor submits
the monthly Payment Claim, the SO is not obliged to proceed with the
certification process of the monthly payments. Therefore, it is only within
14 days of receiving a Payment Claim duly submitted pursuant to
Clause 32. l that the SO must certify to the Contractor, with a copy to the
Employer, the amounts to which the Contractor is in his opinion entitled
in respect of each of the amounts in the statement, subject to the
deduction of any sums which have been or may become due and payable
by the Contractor to the Employer under the Contract or otherwise.
In the 2005 edition, there is an important amendment made which
affects the status of the SO as a certifier. While the common law
interpretation of the status of a certifier is clear in that the certifier must
be independent, the provision that deems the SO's Payment Certificate as
a Payment Response by the Employer should the Employer fail to give
his Payment Response may be seen as eroding the independent position
of the SO. This is because the document known as the Payment Response
4 I See cl 32.6.
42 See cl 32.1.
43
232
Sec cl 32.3.
233
44
45
46
47
48
See cl 32.5(3).
See under cl 32.5(2).
See under cl 32.5(4)
See cl 32.5(6)(a).
See cl 32.5(6)(b).
234
Cross References
The clauses expressly referred to in this clause are Clauses 21. l
(Contractor to Attend Measurement).53 23.3 (Substantiation of Claims),54
23.4 (Access to Contractor's Books and Documents),55 23.5 (Payment of
Claims).56 23.5( I) (Payment of Claims),57 23.5(2) (Payment of Claims),58
23.6 (Fai lure to Comply), 59 32 (Progress Payments and Final Account)/0
32.1 (Payment Claims),61 32.2(1) (Payments Cenificates), 62 32.4 (Final
Payment Claim),63 32.5( I )(a) (Interim Final Account, Final Account and
Final Account Certificate),f>I 32.5(2)(a) (Interim Final Account, Final
49
SO
SI
52
53
54
55
56
57
58
59
60
61
62
63
64
See cl 32.5(9).
See cl 32.5(7).
See cl 32.5(8).
See cl 32.5(6).
See cl 32.4.
See cl 32.4(2).
See cl 32.4(2).
See cl 32.1 (d).
See cl 32.1 (2).
See cl 32.4(2).
See cl 32.4(2).
See cl 32.6.
See sub-ell 32.2(1 ). 32.4(2) and 32.7(3).
See cl 32.2(2)
See ~ub-cll 32.5(1 )(a). 32.5(2J(a) and 32.7(3).
See cl 32.5( 1)(b).
235
Generally
The appointed certifier must comply with his duty lo certify as prescribed
by the Contract from which the duty is imposed. In the case of a Final
Completion Certificate, the name of the certificate would suggest a final
completion of the Contractor's obligation to perform pursuant to the
Contract.
The likely effect of this final completion certificate is to mark the end
of the Contractor's obligation to carry out and complete the Works during
the Contract Period and his obligation to return 10 Site to carry out repair
works during the Defects Liability Period including a post-Defects
Liability Period req uired to carry out repairs to items of work identified
usually in a Schedule of Defects to be given within a fixed number of
days after the expiry of the Defects Liability Period.
The other effect of the certificate would be decided by the parties, that
is, whether the parties agree that the final certificate may act as
conclusive evidence for any specified purpose like 'the Works have been
completed in accordance with the Contract'. This means that the parties
have agreed to be bound by the opinion of the certifier and cannot raise
any dispute against the fac t for which the final certificate is conclusive
evidence. On the other hand, the certificate would be left intact as one
piece of evidence as to whether 'the Works have been completed in
accordance with the Contract'.
Intention of the Clause
65
66
67
68
69
70
71
72
This clause has two sub-clauses. The first sub-clause prescribes when the
Final Completion Certificate should be issued by the Superintending
Officer (SO). The second sub-clause expressly provides that no certificate
is to have the effect of being conclusive evidence as regards the state of
the Works nor the compliance with the Contract.
237
Contractor
Contractor's rights and remedies
The Contractor1 does not have the right to rely on any certificate of the
S0, 2 which would include the Final Completion Certificate, to be
conclusive evidence by itself in respect of whether the Works3 have been
completed or that any Plant,4 materials, goods or work to which it relates
are in accordance with the Contract. 5 Accordingly, these facts must be
established by proof. Although it is not expressly stated, it is submitted
that the effect of the Final Completion Certificate is to, inter alia, indicate
the end of the Contractor's obligation to return to the Site to complete
work outstanding at the Date or Dates of Substantial Completion as may
be instructed by the SO and to execute all works of amendment,
reconstruction and remedying defects, shrinkages or such other faults of
whatever nature as the SO may have instructed, all in accordance with
Clause 18.
the SO mu5t monitor when 30 days after the Defects Liability Period or
Periods, as the case may be, would expire and he must know whether the
work which he instructed the Contractor to do under Clause 18 is
completed.
Cross References
The clause expressly referred to in thb clause is Clause 18 (Defects). 9
The Final Completion Certificate is also mentioned in Clause 32.5(8) and
32.5(9).
Employer
Employer's rights and remedies
The provision in Clause 33.2 is important to the Employ,er in that any
certificate issued by the SO does not affect adversely his fight to claim
that the Contractor has breached the contract. Neither does it affect his
right to a set-off against any Contractor's claim in respect of defects.
Superintending Officer
Role of the SO
The main role of the SO in this clause is for him to issue the Final
Completion Certificate to the Contractor with a copy to the Employer.6
However, as Clause 33.1 does not state what should be in the contents of
the certificate, the SO would have to certify 'final completion'.
He is to issue it within 30 days after the expiration of the Defects
Liability Period7 or if different Defects Liability Periods are applicable to
different phases or parts of the Works, the latest of such Periods or as
soon as thereafter as any work instructed pursuant to Clause 18 is
completed.8 ln order to perform his certification duty under this clause,
2
3
4
5
6
7
See cl 33.1.
239
Generally
241
decision. It must be noted that any such reference must state that it is
made pursuant to Clause 34. l.
By the second limb, 34.1(2). the SO is required to give his decision in
writing to both the Employer and the Contractor within 30 days after the
date upon which the SO received the reference. The effect of which is that
the decision is final and binding on the parties unless either party refers
the decision to arbitration as provided by Clause 34.2( I )(b).
The last limb, 34.1 (3). reminds the Contractor that his obligation to
carry on with the Works under the Contract remains although there is a
reference made to the SO. In addition. both parties are required to give
effect forthwith to every decision of the SO unless and until the same has
been revised by an arbitrator or as may be otherwise ordered by a Court
of competent jurisdiction.
The second sub-clause, 34.2, has three limbs and provides for the
parties to refer their disputes to arbitration or litigation. By the fust limb,
34.2( 1), which has two parts, the first part provides for the parties to
proceed with arbitration. without fust having to refer to the SO, by onr
party giving the other party a Notice of Intention to Arbitrate'; while tt
second part similarly provides for the parties LO refer the SO's decision
the SO's failure to decide, then to refer the dispute or difference alrea
referred to the SO to arbitration.
By the second limb, 34.2(2), it is stated that the Arbitration J
applies. It also provides for the appointment of the arbitrator to be agre
by the parties. failing which either party may apply to the Chairman
the Singapore International Arbitration Centre to appoint an arbitratl
Finally, it provides that the consent of the Employer is needed to initial
the reference before the Date or alleged Date of Substantial Completion. a
The last limb, 34.2(3), provides for the parties to refer to litigation in a
default situation where one party does not want to refer the dispute or
decision of the SO to arbitration.
The third sub-clause is a special provision for the parties to refer to
arbitration/litigation, disputes relating to the termination of the
employment of the Contractor or the repudiation or abandonment of the
Contract by either party within 60 days of the notice of termination or act
of repudiation or abandonment. The failure to observe the time limit
would result in the Contractor being barred from pursuing such dispute or
difference in any arbitration or court proceedings whatsoever.
The fourth sub-clause, 34.4, sets out the powers of the arbitrator
should the parties choose to arbitrate their disputes. There appears to be
two types of powers. The first type pertains to the matters concerning the
SO like opening up, reviewing and revising any certificate, opinion,
decision, requirement or notice. The second type concerns the
determination of all matters in dispute or difference. The arbitrator is not
This clause has six sub-clauses. This clause provides for the settlement of
disputes by way of reference to the Superintending Officer (S0),6
arbitration. Litigation, adjudication and mediation. The 2005 edition
included adjudication and a few amendments.
The first sub-clause. 34.1. has three limbs and provides for one avenue
to resolve disputes by way of reference to the SO which is not
compulsory. It must be read with Clause 34.2 which aJlows the parties to
refer their disputes to arbitration or litigation under Clause 34.2(1) and
34.2(3) respectively without first referring the matter to the SO as
provided by Clause 34.2(l)(a). However. by Clause 34.2(l)(b), the
parties may refer the dispute to arbitration after first referring the dispute
to the SO. Clause 34.1 must also be read with Clause 34.3 which
expressly provides that in the event of a tennination, parties shall not rely
on Clause 34. L where the subject matter of the dispute relates to the
termination. Further, by Clause 34.5, parties are not required to refer the
dispute to the SO under Clause 34. I, if the dispute may be referred to
adjudication.
By the first limb. 34.1(1). a dispute or difference of whatsoever kind
that arises between the Employer,7 or the SO or the SO's Representative
(SO's Rep)s and the Contractor9 may be referred to the SO for his
2
3
4
5
6
7
8
9
I0
11 See cl 34.2. For definition of the Date of Substantial Completion, see cl I. I (i).
12 See cl 34.1(3).
13 See cl 34.3.
14 See cl 34.1 (3).
15 See cl 34.5(1).
16 See cl 34.5(2).
17 For definition of Payment Claim, see cl 1.l(s).
Contractor
Contractor's obligations and liabilities
245
t8
19
10
21
22
23
246
Sec cl 34.2.
Sec cl 34.3.
Sec cl 34.5( I).
Sec cl 34. I (3).
247
:ontract by either party, the Employer is not obliged to first refer the
,ame to the SO but may commence the arbitration.24
By Clause 34.6. the Employer is not obliged to refer any di spute or
Jifference to formal mediation but may do so if both parties agree.
Superintending Officer
Role of the SO
Ln the settlement of di sputes or differences between the Employer or the
SO or the SO's Rep and the Contractor, the parties may refer the same to
the SO except where the di spute or difference concerns the termination of
the employment of the Contractor or the repudiation or abandonment of
the Contract by either party. 29
The SO has the power to listen to and decide the reference if the
dispute or difference of whatsoever kind:
(I)
(2)
(3)
27
28
29
Sec cl 34.3.
Set! cl 34.
See cl 34. 1(I).
248
arises between the Employer or the SO or the SO's Rep and the
Contractor:
arises out of the Contract or the execution of the Works;
arises during the execution of the Works or after their completion:
and
Sec cl 34.3.
See cl 34.2.
See cl 34.3.
249
(4)
The dispute or difference which the SO has the power to listen and decide
includes any dispute or reference as to any opinion, instruction,
determination, decision, certificates or valuation of the SO or the SO's
Rep.11
The SO has 30 days after the date upon which he received a reference
to make a decision about the same. He must give notice of his decision in
writing to the Employer and Contractor within this 30-day period. He
must state in this notice that it is given pursuant to Clause 34 and identify
the reference pursuant to which the decision is made.J~
Others
By Clause ~4? the appointed mediator would have to carry out the
formal med1at10n based on the prevailing rules and procedures of the
Singapore Mediation Centre.
35 See cl 34.2.
36 See cl 34.5( I).
37 See sub-ell 34.2 and 34.3.
38 See cl 34.3.
39 See sub-cll 34.2. 34.4 and 345C2).
40 See cl 34.5(2).
30 Seecl34.l(I).
31 Seecl34.l(l)
32 See cl 34.1 (2).
33 See cl 34.4.
34 See cl 34.2.
250
251
Generally
Unless prohibited by the law, the parties to a contract may prescribe any
remedy available to any party whether pursuant to a breach or to the
performance of any lerm of the contract the occurrence of an event or
condition. However, there is a difference between a claim by a party for
damages and a claim for a debt. In Chit() on Contracts, 1 it is said that
'[t]he relevance of this distinction is that the rules on damages do not
apply to a claim for a debt, eg the plaintiff who claims payment of a debt
need not prove anything more than his performance or the occurrence of
the event or condition; there is no need for him to prove any actual loss
suffered by him as a result of the defendant's failure to pay; the whole
concept of the remoteness of damage is therefore irrelevant; the law on
penalties does not apply to the agreed sum: the plaintiff's duty to mitigate
his loss does not generally apply; and the plaintiff will usually be able to
seek summary judgment' .
General Principles (27th ed. 1994. Sweet & Maxwell) vol I, p 1202. para 26-005.
For definition of Employer. ~ee cl I.I (ml.
For definition of Contractor, ~ee cl I . I (f).
For definition of Com:ract, see cl I . I Cd).
See cl 35. I.
253
Generally
Cross References
There is no express reference to any clause. The Employer's right to
recover from the Contractor in thi s Clause 35. l comes from the express
provisions set out in the following clauses in the Contract: Clauses 2.6(a),
2.6(b), 2.7, 10.8, 16. l(l ), 16.3, 18.3, 27.3, 28.1(3). 29. l(l ), 31.2(3) and
3 l.3{c ).
254
Intention of the Cl au se
This clause has two sub-clauses.5 Sub-clause 36.1 has three paragraphs
while sub-clause 36.2 has five paragraphs.
The first paragraph in the first sub-clause, Clause 36. l (I), provides
that the law of Singapore is the law governing this Contract. 6 This means
that Singapore law is the chosen law for both the construction contract
and the arbitration contract which is in the form of Clause 34. 7 It goes on
to provide that the law governing the arbitration is also Singapore law.
Although Clause 36. I (I) provides that the law governing the Contract is
the law of Singapore, Clause 36. I (2) provides that the rights conferred on
a third party under the Contracts (Rights of Third Parties) Act are
expressly excluded8 while there is an express provision in Claus 36.1 (3)
to say that the Building and Construction Industry Security of Payment
Act 2004 applies to the Contract. le is also to be noted that the 2004
edition deleted the provision in the then Clause 36.1 ( 1) of the 1999
edition which excludes the application of the United Nations Convention
on Contracts for the International Sale of Goods. This would mean that in
this edition, the Sale of Goods (United Nations Convention) Act
(Cap 283A) would apply if it is applicable.9 However, a building and
construction contract would usually not be a sale of goods contract.
Although Clause 36.1 (I) provides that the law governing an arbitration
that is commenced under the Contract to be the laws of Singapore, it is
4
5
only in Clause 34.2 that the reader is told that the applicable ar?itrat~on
legislation is the Arbitration Act or any re-enactment or mod1ficat1on
thereof. This will mean that even if the arbitration can be said to be an
international arbitration as classified by section 5 of the International
Arbitration Act, parties are bound by the Arbitration Act because of the
parties' opting out of the International Arbitration Act pursuant to
section 5 of the International Arbitration Act. It also means that the
parties have chosen Singapore as the 'place of arbitration' also known as
the 'juridical seat of arbitration' by section 2 of the Arbitration Act.
The second sub-clause, 36.2, which provides for Notices used in the
Contract, has five paragraphs. Two addresses are identified, namely, the
Service Address of the Contractor for use in Clause 36.2(3), (4) and (5)
and 'such address fof the Employer] as the Superintending Officer shall
in writing notify the Contractor' for use in Claus~ 36.2(4) only. "f!le
Service Address is given in the Fom1 of Tender m accordance with
Clause 36.2 and changes must be made in accordance with
Clause 36.2(2). It must be an address in Singapore where the service of
documents is possible as provided by Clause 36.2( 1).
Whereas Clause 36.2(3) is a general provision for service of
certificates, notices or instruction to be given to the Contractor by the
Employer or the Superintending Officer (SO) by post, cable, telex ~nd
facsimile transmission to or left at the Service address, Clause 36.2(4) is a
specific provision for use under Clauses 3 1 (T~rmin~tion by . the
Employer) and 34 (Settlement of Disputes) by pre-paid registered mat! or
hand delivery to the Contractor's Service address or the Employer's
address as the case may be.
Clause 36.2(3) must be read with Clause 11.2( 1) where it is provided
that any instructions given to the Contractor's Representative pursuant to
Clause 11.2( l) is deemed to have been given to the Contractor.
On the other hand, Clause 36.2(4) must be read with:
Clause 31.l ( 1) where the SO may issue a Termination Certificate to
the Employer with a copy to the Contractor;
(b) Clause 31. J (2) where the Employer may give to the Contractor a
written notice of termination of the employment of the Contractor;
(c) Clause 31.2(3) where the SO is required to certify the Employer's
Cost;
(d) Clause 31.3 where the SO is to certify as prescribed;
(e) Clause 31.4( l) where the Employer may give the Contractor a
written Notice of termination;
(f) Clause 31.4(2) where the SO must certify payment to the Contractor
as prescribed;
(g) Clause 34.l(l) where the Employer or the Contractor writes to the
SO for his decision;
(h) Clause 34. l (2) where the SO must give notice of his decision; and
(i) Clause 34.2(1 )(a) and (b) where the Employer or the Contractor
may give a Notice of Intention to Arbitrate.
(a)
257
Clause 36 -
The Service Address is also the address designated for the service of any
originating process by paragraph 5. So far, the provisions have been
consistent. However. this provision is for the service of any originating
process by the Employer or the SO on the Contractor and not vice versa.
What appears to be inconsistent is the provision found in
Clause 36. 1(3) where the certificates, notices or instructions to be given
to the Contractor by the Employer or the SO are also required to be sent
to the Service Address but by way of post, cable, telex or facsimile or to
be le ft at the said address. Whilst a postal address would be suitable for
service by post, cable and the physical leaving of the documents, telex
a nd facsimile machines have their own service address which is not the
same as the postal address. This is supported by the fact that in
paragraph 6 of the Form of Tender, the tenderer is required to give not
only the Service Address but the respective numbers of the tenderer's
telephone. cable/telex and facsimile.
As the Service Address plays an important role in this Contract, the
failure to insert the postal address in paragraph 6 of the Form of Tender
would mean that the Employer and the SO would have no means of
effective communication with the Contractor. One possible solution
would be to provide a default address to be used in this circumstance.
Furthe r, there is also no mention of communication by the now widely
accepted electronic mail (e-mail) communication mode. This would
mean that communication by e-mail in respect of the ide ntified
documents would not be effective.
Contractor
See cl 36. )( I l
See cl 36. I(2).
For definuion of Contraccor. see cl I. I(I).
For definition of Tender, see cl I. I(ad).
See cl 36.2( I). See also para 6 of the Form of Tender.
For definition of Superintending Officer. see cl l.l(ab).
See cl 36.2(2)
258
Go~eming
invoke the provisions of this Act to take action against the Contractor nor
Employer. 3~
Role of the SO
The SO must take note of the Contractor's Service Address from his
Form of Tender which is used for the purpose of servi ng documents
under the Contract. 28 He must monitor any change in the Contractor's
Service Address.29 If the SO needs to send any certificates, notices or
instructions to the Contractor, he must do so by sending the same by post,
cable, telex or facsimile transmission to or left at the Service Address. 3
Where the SO needs to send a certificate or a notice under Clause 3 l
(Termination) or 34 (Settlement of Disputes) to the Employer and the
Contractor. he must do so by pre-paid registered mail or hand delivery to:
( 1)
(2)
Cross References
See cl 36.2(5).
Sec cl 36. I.
See cl 36.2( I).
See cl 36.2(2).
See cl 36.2(3).
Sec cl 36.2(4)(b).
See cl 36.2(4)(a).
See cl 36.2(5).
34
35
36
37
260
26 1
Option M odules
263
Option Modules
(i)
(j)
There is only one clause in this Option Module B. The value of unused
goods or materials not delivered to Site, if claimed by the Contractor, may
at the discretion of the SO be included in the amount of payment certified
by him under Clause 32.2. This must however meet the ten requirements
set out under the proviso in Clause B 1.0:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
2
3
4
See cl C2.0.
See cl C3.0.
See cl C4.0.
See cl C 1.0.
265
Oplion Modules
9
10
11
12
13
14
266
15 Sec cl 09.
16 See cl 010.
17 See cl DI l.
267
Supplement
The 'Appendix' refers to the appendix to the Conditions. This is a twopage collection of various items for which the Employer or the
Superintending Officer (S0)5 inserts or specifies where appropriate, an
entry pursuant to the requirements of various provisions. If the blank
space for an item is not fi!Jed. the consequences depend on whether it is
optional for the filling of the blank space in which case it would be taken
as the item is not applicable as in Item I (Option Modules)6 or whether
there is a default provision in which case the default provision applies as
in Item 7 (Defects Liability Period) 7 where the default period is 12
1
2
3
4
5
6
7
269
Suppleme111
(2)
(3)
(4)
(5)
270
~i~in a reasonable time. This may also affect the operation of the
hqu1dated damages clause since there would be no obligation on the
part of the Contractor to complete by an identifiable completion
date at the outset.
Where there are no phases or parts to the Works 9 the time
inserted will be that for the whole of the Works. Whe;e there are
phases ?r parts. the 1:ime for Completion for each of these phases or
parts will have to be inserted individually in the Appendix.
(6)
(7)
(8)
(9)
9
For definition of Works. see cl I. I (ag).
10 See cl 16. 1(2).
27 1
S11pplemell1
(3)
(4)
(5)
(6)
(a)
for the duration as set out in paragraph 3 bearing in mind that their tender
may not be accepted even if it is the lowest as mentioned by paragraph 4.
Indeed paragraph 4 also provides that the whole tendering exercise may
be a futile one in that the addressee is not bound to accept any tender at
all.
Second, paragraph 4 binds the tenderer and the addressee to a contract
based on the Contractor's Form of Tender and the addressee's wrillen
acceptance. In particular, paragraph 2 provides for the commencement of
the Works as well as its completion.
272
273
form of Tender
Supplemem
Agreement
274
275
(d)
(e)
the Specifications;
the Drawings;
(f) the Bills of Quantities/Schedule of Rates*; and
(g) the Addenda Numbers.
(* Delete as appropriate)
and conclusive'. Paragraph 6 clarifies that the Employer may make more
than one claim on or direction under as long as the aggregate amount
does not exceed the Guaranteed Sum. The last paragraph confirms that
the laws of Singapore are applicable and the jurisdiction of the Singapore
courts to hear the dispute if any.
The third part is the part where the Guarantor must execute the
document by filling in the date, the respective names of the person
authorised to sign on behalf of the Guarantor and the witness and the
signatures of the two.
Index
Adjudicator
role in settlement of dbputes, 250
Administra tion
contractorobligations and liabilities of,
84-85
rights and remedies of, 85
employer's obligations and
liabilities. 85
generally, 83
intention of clause I I , 83-84
superintending officer, role of,
85-86
Agreement
contents of, 274-275
Ap pendix
contents of, 269-272
definition, 12
Arbitrator
roleofprocedure for claims. 158
quality in construcllon. 81
settlement of disputes, 250, 251
time for completion, 107
Architect
agenL employer's. 25
Assignment
contractorobligations and liabilities of,
198
rights and remedies of. 198
drafting considerations, 7
employer's right and remedies.
198-199
generally, 195-197
intention of clause 30, 197 198
superintending officer. role of, 199
276
Index
bult'~
construction equipment.
temporary works, materials
and goods, 163- I64
contract documents, 34
damage to property of employer
or government. 190-191
defects, 129-130
designdrafting considerations. 6
expediting progress of works,
110
fees, 60
general responsibilities, as to,
169-170
generalgenerally, 37-38
intention of clause 4. 38-40
list of, 40-42
governing law. 258-259
indemnity provisions, 174-176
insurancepersonal injury. workmen's
compensation and property
damage. for. 180
works, of the, I 84-185
liquidated damages. 116-117
measurement. 146
notices, 60
permanent works designed by
contractor. 55
possession of site, 89-90
programme for the works,
67-68
progress payments and final
account, 223-227
quality in construction, 74-76
recovery by employer. 254
setting out, 63-64
settlement of disputes. 244-245
subcontracting. 198
substantial completion.
123-124
sub-surface and ground
conditions, 49- 50
superintending officer's
instructions, as to. 28
suspension of work. 96
termination by employer,
204-207
time for completion, 103- I04
Conditions
definition. I 3
Construction equipment,
temporary works, materials and
goods
contractorobligations and liabilities of.
163-164
rights and remedies of. 164-165
definition, 15
cmployerobligations and liabilities of,
165
rights and remedies of, 165
role of, 165-166
generally, 159- 162
intention of clause 24, 162-163
superintending officer. role of, 166
temporary works, defin ition, 22
Construction programme. See
PROGRAMME FOR THE WORKS
Contract
definition, 14
Contract documents
contractorobligations and liabilities of, 34
rights and remedies of, 34
drafting considerations. 5
employer's obligations and
Liabil ities, 35
generally, 31-32
importance of. 3 I
intention of clause 3. 32-33
superintending officer, role of, 35
Contract sum
definition, 14
Contractor
definition, I4
employerobligations and liabi lities of, 43
rights and remedies of, 43-44
obligations and liabilities ofadministration, 84-85
assignment. 198
claims for loss and expense,
150-151
claims. procedure for. 155- I 56
commencement of works,
89-90
278
sub-contractors. See
SUBCONTRACTING; SUBCONTRACTORS
Contractor's representatives
definition. 15
Costs
all inclusive pricedrafting considerations, 5
Damage to property
employer or government. ofcontractorobligations and I iabilities of,
190-191
rights and remedies of, I 91
employerobligations and liabilities of,
192
rights and remedies of,
192-193
genera)) y, I 89-190
government, role of, 194
intention of clause 29, 190
servant or agent of comractor,
position of, 193-194
sub-contractor, position of,
193-194
superintending officer. role of,
193
insurance for. See JNSLRMICE
(personal injury. workmen~
compensation and property
damage. for)
] JO
fees, 61
final completion certificate, 238
general responsibilities, as to.
170-171
generally, 42-43
governing law, 259
indemnity provisions, I76
insurance of the works. 185
liquidated damages, 117
measurement, 146
notices. 61
possession of site, 9 I
programme for the works. 68
progress payments and final
account. 227-230
quality in construction. 76-77
selllement of disputes, 245
subcontracting. 198
substantial completion. 124
sub-surface and ground
conditions, 50
superimcnding officer, duties
delegated by, 28
suspension of work, 96
termination by employer, 207
time for completion, I 04
valuation of variations.
142-143
variations to the works. I 36
role ofsenlement of di~putes. 2.t6-247
termination by employer. 208
Damages
liquidated. See LJQUIDA rED
DAMAGES
Defects
cam.es ofdrafting considerations, 6
common law remedy, 127
contractorobligations and liabilitie~ of,
129-130
right~ and remedies of, 130
definition. 15-16
employerobligations and liabilities of,
130
rights and remedies of, 130-13 I
generally. I 27-128
intention of clause 18, 128-129
'179
Index
Index
Disputes
settlement of. See SEITLEMENT OF
DISPlITES
types of, 11
Drawings
definition, 16
function of, 31-32
Employer
damage to property of. See
DAMAGE TO PROPERTY (employer
or government, of)
defini tion, 16
obligations and liabilities ofadministration, 85
claims fo r loss and expense,
15 1-152
claims. procedure for, 157
commencement of works,
9 1-92
construction equipment,
temporary works. materials
and goods, 165
contract documents, 35
contractor, to. 43
damage to property of employer
or government, 192
defects, 130
expediting progress of works.
11 1
fees, 60
280
notices, 61
permanent works designed by
contractor. 56
possession of site. 92
programme for the works,
68-69
progress payments and final
account, 231-232
quality in construction. 78
recoverygenerally, 253, 254
intention of clause 35,
253-254
seltlement of disputes. 248
subcontracti ng, 198-199
substantial completion , 124
sub-surface and ground
conditions, SO
superi ntending officer, as to.
28-29
termination by employer,
208-209
time for completion, I 05
variations to the works, 137
role ofconstruction equipment.
temporary works, matenals
and goods, 165-166
settlement of disputes. 248-249
termination by employer, 210
termination by. See TERMINATION
BY EMPLOYER
E ngineer
agent, employer's, 25
Equipment. See CONSTRl.iCTION
EQUIPMENT, TE.'>fPORARY WORKS.
MATERIALS AND GOODS
CO'o;STRUCTlON EQUIPMENT.
TEMPORARY WORKS, MATERJALS AND
GOODS
Index
Headings
role of, 22
Housing a nd Development Board
standard form contract, 2
Indemnity provisions
contractorobi igations and liabilities of,
174-176
rights and remedies of. 176
employerobligations and liabilities of,
176
rights and remedies of, 176-177
generally. 173
intention of clause 26, 173-174
superintending officer, role of. 177
Insurance
personal injury, workmen's
compensation and property
damage, forcontractor's obligations and
liabilities, 180
employerobligations and liabilities of,
180
rights and remedies of. 181
generally. 179
intention of clause 27, 179
superintending officer, role of.
181-182
works. of thecontractorobligations and liabilities of.
184-185
nghts and remedies of. 185
CONSTRUCTION EQUIPMENT,
TEMPORARY WORKS, MATERIALS AND
GOODS
282
Index
Med iator
role in settlement of disputes. 250,
251
Notices
contractorobligations and liabilities of, 60
rights and remedies of. 61
employerobligations and liabilities of. 61
rights and remedies of. 61
intention of clause 7, 59 60
superintending officer. role of,
61-62
Novation
concept of, 195. 197
Option modules
Bill of Quantities, 263-264
defin ition. l 8, 263
fluctuations, 265
generally, 263
nominated sub-contractors,
265-267
unused materials or goods not
delivered to site, 264-265
Payment
all inclusive pricedrafting considerations, 5
progress payments. See PROGRESS
PAYMENTS AND FINAi ACCOUNT
Payment certificate/response
definition, 19, 219
response amountdefinition, 20-21, 219
Payment claim
claimed amountdcfinition, 12 13, 219
definition, 18- 19, 218
final payment claim, definition, 17,
220
submission of, 9, 219
Performance guarantee
contents of, 275-276
Permanent works designed by
contractor
contractor's obligations and
liabilities, 55
employerobligations and liabiliues of, 56
rights and remedies of. 56
generally, 53
intention of clause 6, 54-55
283
Index
Index
generally, 71 - 72
intention of clause 10. 72-74
superintending officer, role of.
78-81
generally, 65
intention of clause 9, 65-67
superintending officer, role of,
69-70
Rates
definition, 20
schedule of. 31
Regulations
compliance with, 59
Response amount
definition, 20-21
Setting out
contractor's obligations and
liabilities, 63-64
generally, 63
intention of clause 8, 63
superintending officer, role of, 64
Settlement of disputes
adjudicator, role of, 250
arbitrator, role of, 250
contractorobligations and liabilities of,
244-245
rights and remedies of, 245
role of, 246-247
drafting considerations. 7
employerobligations and liabilities of,
247-248
rights and remedies of, 248
role of, 248-249
generally, 241-242
intention of clause 34, 242-244
mediator, role of, 250
Singapore International
Arbitration Centre. role of, 251
Singapore Mediation Centre, role
of, 251
superintending officer, role of,
249-250
Property
damage lo. See DAMAGE TO
PROPERTY
Site
Quality in construction
definition, 21
possession of. See POSSESSION OF
SITE
Specifications
definition, 21
function of, 31-32
284
Subcontracting
Sub-contractors
liability ofdamage to property of employer
or government. 193- 194
nominatedOption Module D, 265-267
Substantial completion
contractorobligations and liabilities of,
123- 124
rights and remedies of, 124
date of substantial completion,
definition, 15
employerobligations and liabilities of
124
'
rights and remedies of, 124
generally, 12 1-122
intention of clause 17. 122-123
superintending officer. role of,
124-125
Superintending officer
agent, employer's, 25-26
authority of. 25-26, 29
contract documents, role as to, 35
285
Index
Index
setting out, 64
settlement of disputes, 249-250
subcontracting, 199
substantial completion.
124-125
sub-surface and ground
conditions, 50-51
suspension of work, 97
termination by employer.
210-213
time for completion, I 05-106
valuation of variations, 143
variations to the works, 137
Superintending officer's
representative
assistants, role of. 30
definition, 21, 26
drafting considerations, 5
role of, 30
Suspension of work
contractorobligations and liabilities of, 96
rights and remedies of, 96
employer's obligations and
liabilities, 97
generally, 95
intention of clause 13, 95-96
superintending officer, role of, 97
Temporary works. See
CONSTRUCCTON EQUIPMENT,
TEMPORARY WORKS, MATERIALS AND
GOODS
Tender
definition, 17, 22
form of, 272-273
letter of acceptance, definition, 17
Termination by contractor
drafting considerations, 7
Termination by employer
contractorobligations and liabilities of.
204-207
rights and remedies of, 207
role of. 208
employerobligations and liabilities of,
208
rights and remedies of, 208-209
role of, 210
generally, 201-203
intention of clause 31, 203-204
Workmen's compensation
insurance for. See INSL"RANCE
(personal injury, workmen's
compensation and property
damage, for)
Works
commencement of. See
COMMENCEMENT OF WORKS
definition. 22
expediting progress. See
WORK
THE WORKS
VARIATIONS
286
287